Author Archives: Royal Frasier

Lessons Learned from Capital Factory Demo Day 2010: What Does It Really Mean To Be Lean?

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At Wednesday’s Capital Factory Demo Day, one of the major takeaways for me was that many of us don’t really know what a lean startup is, or how one is successfully managed. This idea was brought to my attention during Ash Maurya’s presentation called “How to Identify a Lean Startup”.

How to Identify a lean startup

View more presentations from ashmaurya.

In Ash’s talk, he hits on a huge discrepancy in today’s entrepreneurial world. Founders, venture capitalists, and incubators may all have different definitions of leanness, but few know what a lean startup is.

What is a lean startup?

A lean startup is one that makes hypotheses and tests them in quick succession, folds in viable feedback and remains focused throughout this process – in an almost scientific method-like approach. To quote Eric Ries, “startups that succeed are those that manage to iterate enough times before running out of resources.”

Leanness is important in 2010 because in the startup ecosystem, there’s less money and more innovation. Just ask any of Austin’s entrepreneurs who have started multiple companies over the past few decades. It’s a simple issue of supply and demand – the fewer investment dollars available the higher the demand for tested and proven technologies in which to invest.

The argument I’m making (and sharing with Ash) is that teaching current and future entrepreneurs the true nature of “going lean” enables more battle-tested and proven future technologies to live another day. Some of today’s trendy, but quickly fizzling apps lack true market testing in order to scale — because either they didn’t test enough times to reach a marketable solution to a real problem, or they didn’t fit the problem to the right customer. Entrepreneurs don’t always hit on the right problem/solution fit, and going lean in the way that Ash describes helps manage against this common pitfall.

There is always a large degree of uncertainty when running a startup though. This is what I call the X factor and what Ash describes as the “Leap of Faith”. It’s the variable that states, “Yes, you’ve proven your technology and a group of people are using it. But no, that does not mean success is guaranteed.”

It is this “Leap of Faith” that keeps even the most intelligent, hard-working entrepreneurs up at night. It tells us that nothing is a proven science, and luck holds a part in any company’s destiny.

Still, for the first-time entrepreneurs attending Capital Factory Demo Day, the idea of treating their business like a series of scientific hypotheses, testing and re-testing, using this stringent process to define and measure progress throughout development, is very valuable. Especially as more of the methods taught in science creep into how we do business.

Event: ATX Tech Women Meeting

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ATX Tech Women are having their second meet-up tonight. Yes, it took a bit of a hiatus, but recovering from SXSW isn’t a small task.

The group will be meeting at Mangia’s Pizza on Guadalupe so everyone can grab a drink and food before entering into deep, tech-inspired talk. Make sure to RSVP quickly so we can save you a spot!

They’ll also be having a special guest speaker, Susan Strausberg, co-founder of EDGAR Online. She’ll be sharing her experience of founding a company, along with insights and stories of being a female leader in the tech world.

ATX Women in Tech was started by Carla Thompson and Stacey Higginbotham, both local tech all-stars. Carla is an evangelist in the semantic web community and just recently started Sharp Skirts, an online resource for women entrepreneurs. Stacey is a technology journalist for GigaOm, a popular technology online publication.

For more information about tonight’s event or to stay updated on future meetups, search the Twitter hashtag #atxtechwomen.

Informavore: The Future of Data Privacy

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On March 12th, Infochimps, a startup data marketplace here in Austin, entered into a revenue sharing agreement with MySpace allowing the social network’s data to be available for sale on the Infochimps site.

A week later, after ReadWriteWeb wrote about the deal, a number of negative comments and ensuing articles were written, most notably a conversation thread on Slashdot.

When looking at the RWW article closely, you see that the announcement began with 22 available datasets, but now only 8 MySpace datasets are available on the Infochimps site, without any explanation as to why 14 datasets were removed.

What happened here, and what can this tell us about the possible futures for data privacy?

First, MySpace got themselves into trouble by providing identifiable user data on a 3rd party site (i.e. Infochimps) without notifying users or having any warning in their ToS that this was possible.

Users were also frazzled by the possibility of MySpace profiting off of the sale of this data. And many users completely misunderstood, thinking that MySpace sold the data outright to Infochimps, which was not the case.

MySpace users think of the social network as ultimately private, even though they are publicly sharing much of their information within the site (at times, even their phone numbers).

MySpace is completely within their rights to provide their data firehose to any outside party – after all, it is already available for free via the API. However, many users were unaware of this fact and because MySpace was perceived to be sharing and attempting to sell their data to 3rd party developers, a privacy backlash occurred.

Confused users believed that because their data – including updates, photos, and zip codes – is within MySpace and because their profile is accessible only to friends, they retain control of their information within the walls of MySpace. When users realized this wasn’t the case, it created an unnecessary frenzy amongst users, resulting in anger and mass deletion of many MySpace accounts.

With that being said, let’s do our best to delve into the varying degrees of private and public data.

Danah Boyd’s thoughts on the subject in her 2010 SXSW keynote presentation, entitled “Making Sense of Privacy and Publicity”, is summed up by the following:

Fundamentally, privacy is about having control over how information flows. It’s about being able to understand the social setting in order to behave appropriately. To do so, people must trust their interpretation of the context, including the people in the room and the architecture that defines the setting. When they feel as though control has been taken away from them or when they lack the control they need to do the right thing, they scream privacy foul.

Just because something is publicly available doesn’t mean a user wants it to be publicized.

It’s a debate that has become increasingly prominent and heated. Regardless of your preferences, the privacy of social network user data inherently holds many opinions and perspectives, even within the academic community.

So, what exactly has caused users to get so upset? The major explanations for most of the MySpace backlash can be attributed primarily to three issues:

1) Lack of awareness that user data is already very much available through the API, and for free.

2) Issues and misunderstandings around the sale of the data.

3) How anonymous the use of individuals’ data was kept.

Perhaps the easiest solution to these issues is continued market education and better communication and understanding of the ToS agreements. We, as users, cannot continue to play dumb and resort to reacting against the social network service providers. This will just continue ad infinitum until we reach an agreement on how to best approach the problem that public vs. private social network data presents to us daily.

What if in the future, data is so privately held within the Facebooks and Twitters of the world that anyone looking to slip through and do something really useful to society is sued. Consider the case of Pete Warden, who accumulated data on 210 million public Facebook profiles, planning to give academic researchers access to his findings. Instead, he was forced destroy it. Think of all the amazing insights, tools, and applications that could have been built on that data alone.

On the other hand, we do need some sort of security measures to ensure that if our data is accessible, at least it doesn’t get into the wrong hands (i.e. spammers, identity thieves, etc)

While more clarity of ToS and data privacy needs to be provided by companies, and more awareness needs to be instilled in users, that will not provide a comprehensive solution, especially given the common disregard most users display towards ToS.

What if, instead, use of public and private data included users receiving dividends when their personal data is used for profit generating means, like in financial stocks today? We may also need more options than just opt in and out. Would it mean that opting into something is based more on the circumstance than simply a binary solution of yes/no? Could users be notified with alerts when their data is being accessed, putting the power into the user’s hand to make a clear decision of what privacy terms they really agree with?

Today, groups like the Electronic Frontier Foundation (EFF) are carrying the torch on issues of data privacy and publicity, but how aware are technologists and users of these laws that directly affect us all?

Are we taking adequate measures to educate the next generation on data privacy mistakes, like in the case of MySpace? Or is this even an issue that will be of concern to the next generation, for whom issues of private vs. public are already being reconceived?

What do you think about these issues?

"We Can Do It": ATX Women in Tech Unite

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Last week an uncommon thing happened, 20 women working in technology got together to talk shop. Yes everyone, women do exist in tech. It’s not all greasy haired programmers and shiny suit wearing entreps. Looking around at any tech party in Austin, you usually think “There are too many damn men in this room”; and you’d be right.

Far from being just another “girl social hour”, this group of ATX Tech Women has more than a few goals geared toward their gender. Introducing women to some of the more testosterone-heavy activities in the tech industry is a major focus. These include anything from venture capital procurement to coding.

Being a woman in technology myself, I am excited to see this kind of action and let’s-do-this attitude from my tech female compatriots, who at times run from the technical aspects of the field.

If you’re like me and want to see more women carrying the tech torch, contact group organizer Carla Thompson, a fellow Austin Startup contributor and semantic web phenom, for more information on location/time and getting involved. She’s reachable at carla@guidewiregroup.com.

Informavore: What Vegas Can Teach Entrepreneurs

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Having more information at your fingertips has always made the logical jump to better decision-making, but there are unique cases where this falls flat. Often our unique humanness and inherent biases get in our way and cause us to choose wrongly, usually to the tune of large sums of money.

Vegas is the most common scene of these surprisingly well-known crimes to the self. This mecca for any and all surveillance has aggregated some of the most interesting behavioral data around, and helped unearth two decision fallacies we as humans often fall victim to – the gamblers’ fallacy and the hot hand.

The gambler’s fallacy is most recognizable when a player believes (incorrectly) that after three red numbers appearing on a roulette wheel, a black number is then “due,” meaning it is more likely than a red number. The probability of this outcome is actually not in the player’s best interest. Another similar fallacy is the hot hand, seen when a player believes that he is on a winning streak and that whatever number he chooses to bet on is likely to win in the future.

So, if these are bad decisions on the part of the player, how are businesses preying on this information to make millions and how can we as players take this power back and beat the casinos of the world at their own game?

Based on this University of Nevada study from the Center for Gaming Research, behavioral surveillance or data mining is an area where casinos have excelled for years.

Player cards programs, aka loyalty programs, like Harrah’s Total Rewards helps casinos track what players are spending and predict within a small variable of accuracy how much a player will spend in that casino.

Casinos use this information to target their marketing efforts and get the biggest bang for their buck, per say. It’s then safe to bet (and likely win) that when you start dropping large sums of money in Vegas, all eyes are on you.

The big payoff comes when we become more aware of these inherent biases and connect them to more than simply gambling. First time entrepreneurs are constantly making decisions with present biases and flaws – decisions that could deviate into lots of revenue lossed or gained. No one has the answers to keep these irrational decisions at bay, but the message I am trying so desperately to get across is – pay attention to your data! It will likely be your best entrepreneurial decision.

So often, entrepreneurs get wrapped up in their own gambler’s fallacy or hot hand. In the case of a real life gambler’s fallacy – the new entrepreneur may be facing some uphill challenges, loosing faith in their company, product, or even themselves, and start throwing anything and everything at the wall, seeing what sticks. This startup version of “going on tilt” tends to only add to the frustration and solves nothing.

Of course, failure is often part of the path to success that is a logical mathematical truth. If the average success rate is 25%, then the chance that someone will fail once is 75%. However, the chance that someone will fail twice is only 56%, etc, etc. An example of this in finance translates into a person selling their shares based solely on the fact that the stock has risen for several days in a row and must decrease. This may seem logical, but is not necessarily so.

However, the same downfall can just as easily strike because of the hot-handed entrepreneur who seems to be full of luck. He may be on a winning streak, but if he loses sight of his market, consumers, or company goals – in other words, what the data is actually telling him – he can be equally susceptible to his emotionally biased blindspots.

Both of these mistakes are caused by the nature of the human mind. They are false beliefs that a positive or negative trend has hold on future outcomes and thus, your decision-making. This is nothing new in behavioral studies, which have been preaching these sorts of lessons for some time, but it’s an important reminder for entrepreneurs.

In the end, individuals sometimes act irrationally and make decisions based on emotion rather than reason. We fail to process probability and make decisions accurately when facing uncertainty. And let’s face it, not many careers offer more uncertainty than that of the entrepreneur.

Inaugural Ignite Austin Event Tonight at The Phoenix

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Austin is on fire! The first Ignite Austin event is tonight, January 13th at The Phoenix from 6:30 to 10:00 p.m.

If you aren’t familiar with the Ignite brand and style, then you’re in for a crazy, fun night. The event begins with an opening activity and then the main event – quick fire presentations.
Presenters are given five minutes to speak with only 20 slides to help them along. Each slide is displayed for 15 seconds and moves on to the next slide, whether you’re ready or not.

Ignite events began in 2006 in Seattle, Washington as the brain child of Brady Forrest, tech evangelist for O’Reilly Media, and Bre Pettis, founder of MakerBot. What’s particularly great about these events is that they are organically grown and organized at the local level. Because of their popularity, they have spread to more than a dozen major metropolitan areas ranging from Boston to Bangalore.

Listed below are all 16 presenters and their topics:

Jason Cohen
How to Achieve Spectacular Greatness in 100,000 Difficult Steps

How are the truly amazing works of art, business, or “viral media” created? What is the role of luck versus work? If there’s no roadmap, how do we seek greatness?

Matthew McCabe
Non-profits are Dead, Long Live the Social Business!

What is a social business? An L3C? What are some examples of successful social businesses? The primary goal of a social business is to “do good” and, at the same time, make a profit, which will be reinvested into the company to “do more good.” In this talk, I will discuss some of the fundamentals of a social business, the new L3C business structure, and give a few examples of e-commerce and conventional social businesses.

Jason Pratt
Ten Percent

Five interesting ten-percent stories, myths, and statistics explained. Do you really use just ten percent of your brain? What was Lincoln’s Ten Percent Plan? At what age does the average male’s productivity drop to just 10% of its peak? And finally, why every one of us should give away 10% of what we earn, as a lifelong habit.

Dan Rumney
Why All Companies Should Improvise

Good Improvisational Theatre requires skills and techniques that can be effectively applied in the workplace to create an environment of trust and creativity. Explore these and learn how to apply them and the benefit they can bring.

Lorin Rivers
How to Open a Beer with Anything

If you have pry-top beer but no opener, WHAT DO YOU DO? My presentation will answer that question, and probably no others.

Bijoy Goswami
The Austin Equation

What is Austin’s unique equation? This is (distilled!) result of over a year’s worth of conversations and research distilled into a simple expression: experience + community = scene.

Jonas Lamis
The Story of Paal Payasam

According to legend, The Lord Krishna once appeared in the form of a sage in the court of the king who ruled Ambalappuzha and challenged him for a game of chess. Their contest over a few grains of rice sets the stage for an exploration of Moore’s Law, the exponentially accelerating power of technology, and some thoughts on the future of humanity.

Thom Singer
How to write a book

According to surveys, 87% of Americans want to write a book in their lifetime. Few ever do it. In this talk I will share a simple process on how to tackle writing a book and completing the project for those who have the dream.

Jon Lebkowsky
Future Social

Human communication has evolved from simple symbols to spoken and written languages to print media to broadcast to network many to many communication, and as communication evolves, so do social systems and experiences. What it means to be social changes. How will we be social in five years? Ten years?

Trey Ratcliff
Seeing the Light – Photography Evolves

It will be a five-minute non-stop eye-candy-fest. I’m not trying to sell a thing — just here to expose the world to a new type of photography that is one of the coolest things to come along since sliced JPEGs.

Matt Manroe
The Age of Creativity: revival or survival?

In the new global economic age how can we as America stay differentiated? Should we be entering the age of creativity as we look to the future. Can the old industrial America re-invent itself? Can we all be encouraged and taught that the right answer is the more creative answer. That the less-in-the-proverbial-box answer is where America’s true strength lies. Can we be less about fitting in and more about letting it out.

Steven Collier
Is the Smart Grid the next Internet?

The 100+ year old electric utility grid is in for a revolution and a remake. Whether your interest in the Smart Grid is motivated by economy, reliability, sustainability, climate change, renewable energy, national security, customer service, or high tech wizardry, the Smart Grid is something that you want to watch. Austin Energy and neighboring Bluebonnet Electric Cooperative are leading the way to keeping the lights on in the 21st century!

Lani Rosales
Etymology of Curse Words

For fun, I’d like to spice the night up with the etymology of some of America’s favorite curse words- we should know the history of the expletives we use so freely, especially those of us online, right?

Chris Fancher
How Technology and Pirates Make a Better High School

I teach at Manor New Tech High (MNTHS) one of 4 New Tech Foundation schools in the Austin area. Teachers use Project Based Instruction (teaching concepts rolled into a storyline) and we use technology to enhance that teaching method. There is a 1:1 computer/student ratio, and classes are small. Our schools are not “Magnet” schools in the classic sense but are open to all students within the school district. At MNTHS we’ve had success even with our low economic level and English as a second language students. I want to share one of our recent math Projects, featuring a pirate theme, and talk about what you, the tech community, can do to support the New Tech schools near you.

Whurley
The Reality of Being ‘Open’; 20 Things You Need to Know

Open source and open innovation all the rage these days. However, there are a few things you should know before diving into these “open waters”. Why do open projects fail? How does a corporation become open? Just two examples on the path to the real question…where the hell are all of the people that make up this “community” thing and why aren’t they participating in ours?

Joshua Baer
Why I’ll Never Buy Another Gas Powered Car

Comparing an electric car to a gas powered car is like comparing an iPhone to a cellular phone. Once you try it, you realize that its not just incrementally better, but a whole new experience. I’ve been driving an electric car for almost a year now and I’m convinced that this is the future. Find out why I’m never buying another gas powered car and see the Tesla Roadster up close.

Informavore: The Best in DataPorn

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Tis’ the season for “Best of” articles and AustinStartup is no exception, in this case with data visualization tools. I was initially inspired to compile this list based on Wired’s Mark Horowitz article in Edge that says “the biggest challenge of the Petabyte Age won’t be storing all that data, it’ll be figuring out how to make sense of it.” Making sense of our growing amounts of data is critical, so I want to explore some of the more useful data visualization tools, which help us do just that.

Data visualization is a technique to graphically represent sets of data. It’s used most often with datasets that are so insanely large or abstract that only a visual aid can help you read or understand their meaning.

The data visualization landscape is fairly diverse – ranging from tools for networks, music, online communities, photos, or the entire Web itself. Before compiling this list, we considered a few criteria including – interactivity, beauty, functionality, and meaningfulness. Below is list of our personal favorite data visualization tools for a range of tasks:

Flare:

http://flare.prefuse.org/

Flare is all about interactivity. If you don’t get too caught up in the pretty moving charts and graphs, you can see that they support an amazing toolkit of functions – data management, visual encoding, animation, and interaction.

Last.forward

http://build.last.fm/item/42

Part of the Last.fm widget gallery, Last.forward is an open source software for analyzing and visualizing social networks.

Fidg’t

http://www.fidgt.com/visualize

One of my favorites – the Fidg’t desktop application lets you view your social networks habits. You can see what music they are into or even what kinds of pictures they are taking.

Opte

http://www.opte.org/

Opte lets you graphically map the Internet. The data represented and collected on this site is then used to: model the Internet, analyze wasted IP space, or detect the result of natural disasters, weather, and war.

Akamai Technologies

http://www.akamai.com/html/technology/dataviz1.html

Akami’s tools are an interesting way to see the web in real time.

Musicovery

http://musicovery.com/

Helps you discover new artists based on what you already like – sort of like a visual display of your Pandora.

Want more evidence for what data visualization tools are the most useful? Or even, what kind of data could be best used to create these graphs and charts? A local company, New Media Consortium, conducted a survey based on what tools, data, and use cases are best for data visualization.

The results of their survey are pretty interesting and help bubble up some of the more specialized visualizing tools, techniques, and uses out there.

Gowalla Raises $8.4 Million

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Following rumors from Silicon Alley Insider last week, Gowalla officially announced today a funding raise of $8.4 million in venture capital from Greylock Partners, Maples Investments, Shasta Ventures and others.

Gowalla is a location-based social networking application for smart phones. Similar to Foursquare, they let you share and discover new locations based on your social networks. Users earn stamps for their digital passports based on the places they’ve visited, which range from Seattle’s Space Needle to the Austin Java down the street.

The company has raised a total of $10 million since it was founded in 2007. Currently, the service is free and available on iPhone and Android-based smart phones.

Gowalla officially launched 10 weeks ago and according to the article in Austin American Statesman, “50,000 users have joined since” then and “users have created and checked in at 150,000 locations in over 8,500 cities in 100 countries.”

See our past coverage of Gowalla here.

Informavore: Creating an Employment Forecast That Matters

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Austin has for some time heard that we are recession-proof or at least more immune than other U.S. areas. In October, Austin Business Journal reported that the “recession ended… in one out of every five metro areas in the United States, including Austin”. The data was based upon a report from The Adversity Index, Msnbc.com and Moody’s Economy.com, which listed Austin as in recovery.

However, amid another round of job losses in Austin last month, relying on national economic forecasts appears ambiguous at best, especially in assessing its effects more personally. What if you could use that same data to accurately predict your own future job security? Could you possibly even measure the optimum time to jump ship and make a career move.

Data-driven services that make highly personalized predictions already exist. Life insurance actuaries are some of the most famous, tasked with mining big heaps of data in order to predict the length of a human life. What’s more personal than that?

With everyone mining data in order to reach more valid conclusions, why can’t this same idea be applied to our future job outlook, especially in times when informed career decisions are so crucial.

Statistical tools like predictive modeling, a method for visualizing future trends based on historical data, could be applied to Austin’s economic data, creating a customized approach to economic and employment indicators.

Currently, your best source for Austin economic information is the annual Angelou Economics Forecast. Headquartered in Austin, Angelou Economics is an economic development firm focused on the technology industry. However, has analysis of Austin’s local data reached it’s full potential here? With Angelou stating that Austin is tech savvy because of our high percentage of DVR users, I think not.

Angelou Economics is useful for casting a wide economic net around a community and drawing out its future market potential, but when you apply Angelou’s economic forecast to your personal situation, it falls short. In the 2009 Austin forecast, the descriptions of future trends read like monthly horoscopes – vague and impersonal.

The data is already open and available through the Bureau of Labor Statistics and the U.S. Census Bureau. With all the talented programmers in Austin, it must be possible to create a tool to give all of us a little more control over a shifting marketplace.

There are, of course, issues with inaccurate predictions and the potential affects if say, you left your job because you thought it was going under, which later turned out to be false. However, from the opposite perspective, how much better off could you be if you were able to predict months in advance that your job would no longer be available? Either way, the issue remains the same – give people more control and insight into their career future.

The web today is all about becoming personalized, and data should likewise apply to being more personally relevant rather than just mapping out broader trends, which hold no meaning for the individual. There is a personal economics we can glean if we only had the right tools and services to do it. If these tools don’t exist, then they should.

Resources for Austin's Startups from CoA's Emerging Tech Program

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A recent ReadWriteWeb article got us thinking – what local government initiatives are out there to help the local startup community? So, we did a bit of investigating and here is what we found out:

I sat down with with Eve Richter, coordinator for the City of Austin’s Emerging Technology Program, to discuss the program and Austin services available to the local startup community.

She explained that the Emerging Tech Program’s main goal is “to attract, retain, and facilitate the growth of emerging technology firms in Austin.” That includes Austin startups. The Emerging Tech Program consults with Austin startups to help them meet their networking, financing, market development and business development needs. If you would like to take advantage of any of these services, contact Eve Richter at eve.richter@ci.austin.tx.us.

Other City resources and partners available to the startup community include:

Greater Austin Chamber of Commerce: In need of data on Austin? The chamber has loads of spreadsheets available for you to research the area you’ll be running your startup. Also, they provide a Business Retention & Expansion program aimed at fostering “an innovative and diverse business community”.

Small Business Development Program: SBDP encompasses many new business solutions; however the most useful to startups seems to be the BizAid Program, created to help entrepreneurs move from one growth phase to another.

Austin Entrepreneurs Network: AEN offers help for an array of startup issues including networking, mentoring, and funding. They’ve also compiled a very comprehensive list of Austin resources for startups ranging from networking to VC funding sources.

Austin Technology Incubator: A partner of the City of Austin, ATI “works with early stage technology companies to increase their odds of success and decrease their time to capital and markets.” ATI includes a Wireless, IT, Clean Energy, and BioScience incubator.

The life of these services are largely based on the demand for them. If you read about a City resource you found interesting or potentially useful to your startup, contact them – show that there is a need.

For more resource ideas, see the ETP’s website.