Thursday, November 23, 2006

Remote Back Ups

After having another hard drive crash on me recently, figuring out a better back-up system has been on the top of my mind. I have 2 external hard drives but haven't managed to do regular backups with those so I was looking for a solution to this problem as clearly the internal hardware option appears not to be something that I've been very diligent about leveraging.

AT&T left me a voice mail (computerized of course) mentioned their vault product for online backups and I was like "ah... hah". Perfect concept. About the same time, I met Pat from Rackspace and he mentioned that he just got his parents set up with Carbonite for $5 / month.

I've been doing some research on online backup providers. I've signed up and am going to try out two options (the free is compelling for obvious reasons):

Other options Pat suggested that I take a look at included:

Both seem to be about $5 / month or $60 / year.

Pat also suggested checking out this article for a good overview on online storage.

I'll keep you posted but I am pretty excited to date how Mozy is going (in theory - I haven't tried recovering anything yet). Note: they haven't released a Mac client yet but their FAQ indicates one is in the works.

I haven't done much yet with my xdrive account. Probably use that for my MacBook Pro. I'll keep you posted.


Thursday, July 27, 2006

OSCON - Business Models for Open Source Software Companies

Business Models for Open Source Software Companies by Tony Wasserman

I was hoping to get a little more out of this. I always have the expectation that when I hear an academic speak, they'd have all kinds of brilliant insights simply because they can claim they are an academic and get access to lots of great information that wouldn't be available to the press or to others in the industry. This presentation was nothing more than a general run down of the various open source business models out there.

Subscription Model
ala SugarCRM, Red Hat

Commercial and Open Source Products
ala Borland, CollabNet, SugarCRM

Support and Training Model
- Also, publications
Example: Many including O'Reilly
Works well for 1 / small man consulting shops and in develoing countries.

Dual License Model
Vendor offers same software under a commercial license who want or need commercial support.
Example: MySQL

Hosted Service
- Vendor uses open source software to create services that can be given away or sold to customers.
Examples: Yahoo, Google

Packaging Model
- Vendor integrates two or more open source products into a new product stack
- Vendor offers the "added value" stack along with support, training, and consulting
Examples: SpikeSource and OpenLogic

Commercial Enhancement- Vendor uses suitably licensed open source software and derives a new product that can be offered commercially, either as closed or open source.
Examples: EnterpriseDB and SRA OSS (PostgreSQL-based)

Consulting Strategy
- Vendor offers no open source software direcvtly, but helps clients make strategic decisions and investments related to open source
- Vendor obtains revenue by charging customers for their consulting time
Examples: IBM Global Services, Accenture, Gartner

Patronage Model
- Vendor offers open source software, money, equipment, or people's time to the community with no direct expectation of revenue.
- Vendor obtains revenue from other products and services, which may or may not be related to the open source software (and not even be open source).
Examples: Sun, IBM, Microsoft

Reseller Model
Offering free and open source software.

OSCON - Marketing to Dilbert: How to Invite Developers Into Your Project

Marketing to Dilbert: How to Invite Developers Into Your Project by Dave Rosenberg, Mulesource, Stephen O'Grady, Red Monk

Why Is OSS Marketing So Hard?
- Too much noise e.g., too many emails.
- Figure out how to engage audience.
- How to advertise without advertising?

These guys tried to get a discussion going around who does 1) a good job of marketing, 2) who does a decent job of branding but doesn't market well, and 3) who sucks?

1) Redhat, MySQL, SugarCRM, Firefox
2) JBoss, Novell, Sun

Stephen claims that "success of your application will be determined by how well you market to developers and IT staff, not CIOs." He claims this will transform the sales process.

Markets are conversations

- Market Research
- Customer Research
- Competitive Research
- Positioning
- Developer info
- Shared development

- Blogs
- Newsgroups
- Wikis
- Forums, IRC, etc.
- Events
- T-Shirts - 48% response rate when they ran a first 100 promotion.
- Contributions to projects
- Public Relations

Why to open source something?
- solve transparency issues
- solve product quality issues
- solve distribution quality issues (but other ways of solving this problem e.g., free software)

Best opportunities for open source is infrastructure software. Further you get out to the application space.

OSCON - Compiere - Building Successful Commercial Open Source Products

Building Successful Commercial Open Source Products by Jorg Janke

- Compiere is an Open Source ERP solution.
- Started in 1999 - apparently when they started, there were 15-20 open source ERP projects.. Profitable since 2003.
- ERP is a $50 - 70 billion market.

- 250+ customers.
- 100 partners worldwide in Eco-system - Compiere concentrates on enablement / 2nd level support / second level support / training. Partners concentrate on end user satisfaction, sales, tier 1 support.
- Funded - $6 million recently.

Business Models
- Claims business model is more about who your customer is than open / closed source.
- Open source (free) gets you in the door but that is about all you get for being open source. Market share.
- Repeatedly, it has been mentioned this week that lots will use open source product but very few will enhance it / contribute back to it. Lots of architects / advisors but few actual doers.
- Start of open source project - either create it yourself or solves a problem for a limited set of people, or you create it for other people's needs.

He distinguishes between 3 models and the "Commercial Open Source Contract"
- customer does own pre-sales
- pay for support / docs / services
- "if you need help, pay for it"

Where Open Source is Risky
"Open source business works best where software is a commodity and the revenue is in service, insurance, and support." - open source is risky where advantge is in the process / algorithm, where there is high risk, fast changing industry, e.g., payroll.

Compiere Process
- Compiere only supports the latest version.
- Offer easy, stable, proven automatic version migration Service.
- Accepted sponsored development if only on product roadmap
- Accepted development contributors if only very experienced.

Compiere Contribution Experiences
People contribute because:
- improve the product for their own needs
- reduce maintenance effort (core team maintains)
- gain experience. you coach me and I work for free.

People don't contribute because:
- gain competitive advantage
- sell enhancements to others
- keep changes confidential

Contribution LevelsUse and tell others about it
- Evangelists
- References
Use it and give feedback
- QA
Share exactly what they need
- Requriements - "most crucial contribution"
Develop it or help developing it
- Design... code
- code is only 10% of effort for business applications.

Pilot customer
Pilot customer was a complete pull. Released incomplete versions. Customers saw it. Attended trainings. Then sold support contracts.

Why raise funding?- Previous discussions with VCs were not good - product unproven, process unproven, partner model will not work.
- Went about validating it.
- It became a question of growing steadily and slowly or recognize window of opportunity. Appears they raised money for growth and to compete with big boys.
- Customer attraction. VC money validates company / model.

Thursday, July 21, 2005

Marketing for Startups & Guiding Principles

I attended:
TiE Event
Marketing for Startups
6 Guiding Principles

1. Marketing's role is to bring "outside-in" discipline to the organization.
2. Marketing is war. It's not just a battle of products; it's a battle of perceptions.
3. Marketing's job is to focus on the organization where it can win -
on customer segments that will value its unique advantages.
4. A marketing budget must balance people $$ with program $$. You need both.
You need to spend money to make money.
5. Great marketing causes organizational stress - this is a good thing.
6. Superior marketing is as important as superior technology in building long-term competitive advantage.

Mentoring Roundtable
Ponnam Dhawan - not present
Jackie Gilbert - now an independent consultant (more focused on software)
Gary Baum - VP of Marketing at NanoCoolers (more focused on hardware)
Kevin Cunningham - not present

Principle #1
Marketing's role is to bring "outside-in" discipline to the organization.
Who you are going to sell to?
and communicate to the organization.

"discipline" - level of objectivity because you will have pride and blind spots
have to budget enough travel
must get out of office to the customer
want to know your weaknesses
want to here obejctive feedback

???? company did 700-1000 cold calls to do interviews

They were looking for:
- looking for urgent need
- pervasive need
- willing to pay money for

it is painful
you have to spend money to do it

can't stop with idea and concept
you have to do it with product specifications

Value of I/P and getting patents in place - very important.
Intel used patents to block people.

Principle #2
Marketing is war.

It's not just a battle of products; it's a battle of perceptions.

Engineers think truth is enough. Marketers think perceptions are all that matter.

How do you position relative to competition?
How do you appeal to customer?

War Story - Great battle of Intel vs. Motorola:
at stake was the entire market
8086 vs. 68000
Intel had a much more inferior product.
Positioned that they had a vision on computer architecture
Built future out of products that didn't exist
Had this road map
People sat back and said "can I afford not to be on this road map?"

War Story - Tivoli
after tivoli had been bought by IBM
challenge was CA
way they succeeded in positioning superior to ca
made CA look like they were mainframe
succeeded in assocaited CA with old, expensive, monthly license fees.
Took element of truth about their heritage and made it a big issue

Point is - don't do it all of your own.
Analysts, industry pundits are critical.

War Story - PC Magazine
Working with press.
Created a new category of digital imaging and educated PC Magazine on what categories were important.

Principle #3
Marketing's job is to focus on the organization where it can win -
on customer segments that will value its unique advantages.

Buy in of executive management.
If company is not bought in, you will have sales chase where money is.
Need company to stay focused

War Story - Southwest Airlines
flew between 3 cities - San Antonio, Dallas, Houston
price trip below cost of driving
1971 - 1979 only was in Texas
wasn't disracted by going outside thier market

War Story - Big Splash
All CEOs of imaging in one place
Analysts, press all showed up
If they didn't come, they'd be missing something

Principle #4
A marketing budget must balance people $$ with program $$. You need both.
You need to spend money to make money.

All the component parts (literature, market research, analyst influence, etc.) all require money.

How do you hire good marketing talent?
- track record
- who you have worked with
- ask people to pitch their last product to them (in interviews)

Recommended training course called "Pragmatic Marketing" - website is a great resource. Salary survey for product marketing people in high tech.

Principle #5
Great marketing causes organizational stress - this is a good thing.

Sales and technology will be rubbing up against marketing.
Likes to see a marketing person as a founder.

Principle #6
Superior marketing is as important as superior technology in building long-term competitive advantage.

Saturday, May 21, 2005

Legal Issues for Growing Companies Part I

So spent $50 on Friday, May 20 and attended the Texas Entrepreneur Initiative event "Legal Issues for Growing Companies - A best practices and networking program" sponsored by Wilson Sonsini Goodrich & Rossi, the law firm probably most associated with technology startups. It was held at the Commons Center at JJ Pickle Research Campus, all in all a pretty nice location for an event like this. My only complaints were that power outlets were few and far in between and $10 for wireless seemed a bit unnecessary for a UT location, but the breakfast burrito was worth the $1.50 :).

This was a pretty good session and definitely worth the $50. Since Baby Girl Choksi decide to stay in the womb another day I was able to attend. The event schedule was what attracted me in the first place. I had a few focused areas that I was interested in but I get so many questions about starting a company that hearing the latest stuff was probably worth my time just to stay up with the latest trends. Anyways, here are my notes from the session.

9:00 - 9:45 Company Organization, Founders & Early Employees
Paul Tobias, Managing Partner, WSGR, Austin
Ellen Wood, President and CEO, vcfo

When should we create a formal entity?
As soon as possible because of three reasons: 1) define ownership, 2) liability concerns, and 3) intellectual property ownership.

Why should we use a Delaware corporation instead of a Texas or Nevada corporation?
Recommended Delaware corporation for several reasons:
- in M&A transactions, other side will be more experts on DE corporations.
- Real world: if you aren't a DE corporation, one lawyer in the audience mentioned that he treated the other side as though they were "not legally sophisticated counterpart."
- if you are going to raise money, the VCs will make you re-incorporate to be a DE corporation
- certainty with lots of case law vs. other states
- lawyer had seen a Nevada corporation only 1 in 1000 times.
Unfortunately, it is more expensive: $300 - $500 fee in Texas but you pay an additional $1100 fee to be a non-Texas entity in Texas.

What does fully diluted mean?
There is no universal definition for fully diluted.
Typically, it is all shares issued + the total size of the option pool.

How many shares should I start with?
10 million shares of stock is standard but is arbitrary.

When considering stock or option grant, the %age of total shares is what counts. Many people are more concerned about the absolute number of shares. That is one reason to have more shares.

What about founder agreements?
Founder agreements include a couple of important sections:
- survivorship
- divorce issues
- typically prevent you from selling to an outsider without first offering to internal people or investors.

Other points:

  • Since founders are given stock, there really isn't vesting but you can have reverse vesting e.g., if the founder leaves before X amount of time, they have to sell back some of their stock at their purchase price.
  • There is no real difference between options and warrants. Typically options are associated with employees and warrants are for non-employees e.g., board members, service providers, etc.
  • It used to be that one of the values of preferred stock was that you could do common stock options for employees with a low strike price. The new laws have changed that somewhat.
  • Make sure your offer letter doesn't specify the percentage and if it does make sure the offer letter indicates that it is a current percentage.
  • A local CEO was quoted as saying. "The board should consist of a odd number of members and 3 is too many."

How much stock is typically given to board members / advisory board?
0.1% - 1.0%. You really don't want to make it vesting because then you have to fire the board member / advisor if they aren't doing anything (these people are usually customers or industry experts). A better way is to grant stock on an annual basis.

9:45 - 10:30 Intellectual Property: Creating & Protecting IP
Chris Ozburn, Partner, WSGR, Corporate
Scott Morris, Associate, WSGR, Patents

I simply wasn't very interested in the above topic mainly because I figured that if I ever needed to patent something I would go to a lawyer.

I unfortunately had to head to another event so I missed the following topics:

11:00 - 12:00 Landing Early Customers and Strategic Partners
Ken Clark, Managing Partner, WSGR, Technology Transactions
Stacey Smotherman, Of Counsel, WSGR, Technology Transactions
Eric Natinsky, Associate, WSGR, IP Technology Transactions

12:00 - 1:30pm Lunch and Keynote
"Shaking The MoneyTree" Venture Capital Trends through Q1 2005
Kirk Walden, MoneyTree Report, National Director of Venture Capital Research, Pricewaterhouse Coopers

Monday, May 16, 2005

Best Travel Sites

A lot of people ask me what sites I use for booking hotels, car rentals, and airfares. I've been using the aggregator, Sidestep, for a long time and am a big fan. I like the window that pops up within Internet Explorer when you search a site for a particular itinerary. Very useful. I wish it handled multi-leg trips but that may be asking a bit much.

I also use Travelers Advantage ($59 annual fee) for most of my own personal reservations. They often have the best deals in town in particular with their coupons. Also, the 5% back is a pain to get but if you do the paperwork, you can more than easily pay for the annual fee. Having someone you can call is nice especially when I am on the road withour Internet access (yes, it actually happens from time to time).

I just heard about two new aggregators, Kayak and Mobissimo, and will be trying them out over the next few months. Lets see what happens.

Any one know of some good travel sites for international to international travel?

Sunday, May 01, 2005

John Egan of the Austin Business Journal - My first AIEA Meeting

Well, I finally got around to attending my first Austin Inventors and Entrepreneurs Association event. Pretty educational. Kudos to the organizers Chris Ritchie and Jesse Redman.

John Egan of the ABJ spoke on April 27.

The key takeaways were:
  • Don't pitch the ABJ on Tuesdays and Wednesdays. They deliver the paper to the printers on Wednesday.
  • Get events for their calendar to them 2-3 weeks ahead of time.
  • To get on the picture page, work with non-profits.
  • CC John Egan when you pitch reporters.
  • The ABJ writers are looking for "new news" and prefer stuff that isn't being pitched to other locals e.g., Austin American Statesman.
  • 20% of ABJ readers are millionaires.
If this first meeting is any indication, I imagine I'll try and attend more AIEA meetings in the future.