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Monthly Archives: June 2012

Networking: Pay It Forward

Leave a Comment Posted by on June 27, 2012

Networking has proven time and time again to be an invaluable asset for me. By no means am I an expert, but the changes it’s wrought in my life shows just powerful it is. Whether it’s family, friends, co-workers, fellow alumni, or complete strangers, I’ve learned how to hold a conversation and hear advice. Every networking experience is different and I never know what I’ll get out of it. It’s opened me to new experiences and taught me how important engaging and interacting with the world is, instead of letting things just happen to me. Anyways, here’s a few examples of how networking’s impacted my life.

Post college and “how can I volunteer my time?” My first job was working in a private equity and venture capital administration shop. It sounds pretty cool until you realize my day consisted of moving money back and forth between client accounts and their fund investments. Listen, I was thrilled to be hired by a bank in 2008. Hell, I was lucky to have a job. That being said, my long-term goal wasn’t to be the world’s best cash-mover. I did wire transfers from 8am – 6pm, and as soon as I finished, I introduced myself to people in different teams within the group. Finance, project management, technology, sales. It didn’t really matter. I told them all that my day job was over and I wanted to learn more about what they did, so consider me a volunteer ready to do anything they needed. I’m pretty sure no one else did this in my group, ever. So what happened? I got put on RFPs, moved over to support our most important client, was forced to learn and develop all sorts of performance and analytics, and got put in charge of part of a global project. I gained invaluable experience, met some incredible people, learned how the space worked, and developed some great relationships. My working relationship with Tom then turned into a good friendship. Tom put me in touch with the group I work for today. He made the introduction, I interviewed well enough, and I got a new job. By the way, I work at a trading desk.

Business school and “what should I know?” For the readers who know me personally, you probably know I’m applying to business school this fall. You also know I’m also not one to half-ass things. So, to prepare for the journey, I reached out directly to students and alumni to hear about their experiences and take any advice. I canvassed everyone I could think of and got a huge list. There were so many people that I had to build a database just to keep track of who I contacted and when. It was grueling. Blind introductions, cold calls, and frequent follow-ups. I didn’t know how to lead the conversation, couldn’t tell my own story, and wasn’t sure how to convey the right message. I got very friendly help and pretty critical feedback. Sometimes not so friendly, but just as critical. One person almost scared me off altogether. After that conversation specifically, I was forced to reflect on who I was and why I actually wanted to go, and whether my goals were realistic. I determined my goals were realistic and re-doubled my efforts. My overall results were positive. I learned about the schools from people who knew them best, got advice on the application process, was forced to become introspective and really examine my own motives, and I also got an incredible piece of advice, to start a blog and become an expert on the New York startup community. I’m certainly no expert, but this blog is one way for me to get closer (thanks to Chris Yeh).

Startups and “what’s going on?” During my business school preparation, I figured out why I really wanted to go. I love startups and venture capital and needed to get involved. I want do that with VC and I think business school provides the clearest path there. But for me to even pretend to care about startups, I needed to put myself in the startup scene. I started out with my Loyola alumni. Some meetings were interviews and some were just coffees. New York isn’t a backwater entrepreneurial space. We’re often on the cutting edge. Most discussions were really centered around what these people were doing, because it’s often amazing. The average person was helpful, open, and friendly. Most people were willing to point me to someone else too. It’s a collaborative space. My network was originally viral, with patient zero being my fellow alums. Since then, I’ve attended a few Meetups, the next most obvious thing to do. Of course, that paid dividends as well. Anyways, with this, I’m not looking for any immediate payout. I just want to get involved.

I’m very thankful to everyone who’s donated their time to speak to me, talk about their experiences, and lend their advice. I’m better for it, and very happy to return the favor to people. One person put me in touch with some senior VC friends in New York. When I thanked him profusely and asked how I could pay him back, he simply told me “Pay it forward.”

Gladly.

**UPDATE 7/21/12: Wanted to pass this great post on networking from Seth Levine. This was a great base for my approach but I couldn’t find the link when I originally posted**

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Mirth and the Principled Objection of Deals

Leave a Comment Posted by on June 24, 2012

Jeremy Galen is the co-founder and CEO of Mirth. Mirth is a New York based customer loyalty service. Basically, if you sign up and eat or shop at a registered venue twice over thirty days, you receive a small discount on your purchase and give those venues the ability to contact you about special offers. Here, we explore what Mirth is and how the launch has gone. For a list of participating venues, visit this site. For more from Jeremy, you can find him on Twitter at @jeremygalen.

Jeremy Galen

Can you talk about what Mirth is and where it came from?

So it’s a new way for small businesses, bars, restaurants, and shops, to interact with and reward loyal customers. If you’re a member and you pay with a credit card you’ve registered with Mirth, then you seamlessly participate in the program. Then, you become a regular at the bar or restaurant when you visit twice in a rolling 30 day window. On that 2nd visit, you get an email saying “Congratulations, you’re now a regular at this place!” The idea came about by talking to business owners in my neighborhood in New York who voiced concerns about Groupon not working for them and other solutions being ineffective. I started thinking a lot about what they wanted and what could help them and came up with this idea.

So you participated in TechCrunch Disrupt’s Startup Battlefield Competition, what was that experience like?

It was a thrill, it was really exciting. We had a lot of work to do before hand, and it was a ton of jazz. We got on stage and had MC Hammer asking us questions. How great is that?

I saw somewhere on the web that you put Mirth together 17 days before the competition? Is that actually true? How crazy was that?

Yes, that’s exactly correct. I was admitted to the Battlefield in May and I wasn’t actually sure if we’d be able to build a prototype in time. I met my co-founder Phil Reichenberger at the beginning of May, so it was a period of under of 3 weeks. It was truly exhausting.

Not only did you compete in Startup Battlefield, you also officially launched your product at the competition. How’s your growth been since then?

We’re still onboarding merchants, but we aren’t public with our user data because we’re in the process of putting together a round of financing. We got some good signups from the Disrupt presentation. Like most local services, we’re focusing on how to engage merchants in promotions to their own audiences so we can ensure successful interactions between these businesses and their regulars. Most loyalty and local marketing businesses involves a business sending a promotion to the users, then people sign up for a digital punch card or digital wallet or something. People usually find these promotions inside the merchants. We’re just getting started with our own particularly cool version of that.

Something that seems tough for Mirth is the need to acquire both merchants and consumers. Getting one is difficult, how do you plan on getting both?

That’s an execution startup question. How do we get all that right, at the right time, and right place? It’s a huge challenge. Technically, it’s a cool idea and it works. There are no issues there. So how do we make it valuable for the merchants and let people know about it? It’s called a density problem. That’s what happens when you’ve got a two-sided market. We’re working on a couple of really interesting ways to do that.

First, we’re focusing on stylish merchants that don’t like or use daily deals. They’ve done them and they’re unhappy with them. Second, we’re also focusing on geography, like in Lower Manhattan and Brooklyn. They contain the audience we want. The goal is to get the interaction right so it’s worth participating in. It’s exciting to be a member of Mirth. We need to hear what merchants want to do and work with them as partners to get it right.

You’ve worked with startups over much of your career. What have you learned there that’s helping you now?

I’ve worked professionally for all of six years. My early stage ventures have ranged from consumer internet products to enterprise products and most recently I worked on an iPad startup where we sold a SaaS offering to an art gallery. I’ve learned a lot about execution styles, marketing, branding, messaging, and operations. It was also helpful to just understand the day-to-day life of a startup, whether it’s legal issues, accounting, or finance. I’ve had a great education in the workplace.

What’s the biggest hurdle for Mirth?

Our biggest challenge is getting merchants to embrace this principled objection to deals. That’s our academic guideline. Deals don’t work for businesses. They re-train consumers to expect low prices and don’t encourage repeat customer behavior. We’re offering a meaningful alternative to the deal culture. Deals work for people because it gets them out of their desks to stores. Of course they’re excited about sixty to seventy percent off. There’s something thrilling about a coupon. We need to get people as excited about small discounts as they are about deals. We have to overcome that obstacle.

In brief, our biggest challenge is creating an exciting engagement around a much smaller discount.

Mirth’s passive, you sit between consumers and merchants. How do you ensure that consumers actually stay fully engaged?

We offer a small discount in exchange for the rights for the merchant to communicate with you. If you eventually stop being a regular, you stop receiving discounts and messages. I think the messaging component is the real core of this meaningful engagement. If a customer becomes a regular at one or two places, and once in a while they get an email that says “Here’s a Mirth message from Back 40 West” about a special event they’re doing or a dinner prix fixe I can sign up for, or a new special or anything they’d like to share. That makes me aware of Mirth, but really more connected to that restaurant.

How do you want Mirth to be remembered?

Mirth is a technology product that’s not predatory or focused on the wrong kinds of objectives. We’re interested in unlocking value for our merchant partners. It’d be great to be remembered that we provide sustained value for our customers and merchants. There’s no deal that expires, so you won’t feel used or ripped off by the fine print. Here, you can’t feel anything but grateful because you frequent a place and through Mirth you get a little love back on your bill, and you’ll feel taken care of.

What’s the best advice you’ve received?

I think the best advice was from my father, who told me “You never know whether you’re buying or selling.”

Besides Mirth, what’s the best startup you know?

I’m a big fan of letter.ly. It’s a personal subscription email service that lets you sell a subscription newsletter.

Post script: After our interview, Square announced their Digital Punchcard, service and Apple announced their Passbook at WWDC. I asked Jeremy what that meant for Mirth and here was his response:

Both Passbook and the new Square loyalty feature seem like great products and of course they’re going to be rolled out to massive user bases. From what I understand, Passbook is a default app on the new iOS and a bit like the Newsstand app today.  I don’t see how it would be accessible to small business owners that don’t have time to tweet, let alone construct a coupon system.  Square’s loyalty app sounds very elegant, but the merchants we’re working with (for instance) typically have POS work flows that rely on traditional payment processing.  In addition, what makes Mirth cool is how effortless it is for the consumer.  Since it’s linked to your credit card you don’t have to change your current habits in order to participate.

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Kathi Rawnsley on Startup Hurdles & Advice

Leave a Comment Posted by on June 18, 2012

Kathi Rawnsley is a Member of the Firm for Lowenstein Sandler as well as Managing Partner and Co-Founder of their Silicon Valley office in Palo Alto. Previously, Kathi worked at Intel Capital as Regional Counsel and during 2007, she was Acting General Counsel in a year where they invested $639 million in 166 deals. She’s been involved with venture capital and startups since she began her career in 1995. We got to talk about a variety of subjects, including where founders go wrong and what types of hurdles they have to deal with. Enjoy…

So a few months back, Twitter unveiled its Innovators Patent Agreement. Basically, Twitter told its employees that any patents related to their work will only be used for defensive purposes, even if the patents are later sold. It’s a neat concept, but could it have a larger effect on the tech community?

It’s hard to say what kind of impact it will have because I don’t know what their patent portfolio looks like. There are a lot of big players engaged in patent wars right now. It seems like Twitter doesn’t want to get involved with them and they believe in innovation and the general goodness of the tech community. While it likely does have a lot to do with image, I don’t want to say it’s all about that. Regardless, I’m just not sure how valuable it is in the larger scheme of things. There are a few patent trolls that use them offensively on a regular basis, and that’s their business model. This won’t change them. I guess they can’t acquire Twitter patents, but there are still a whole bunch of other ones available. There are certain companies that have huge patent portfolios because they want to have protection when a patent troll or competitor is in the same space.  You don’t see patent battles every day in certain industries because companies/competitors have built their patent portfolios so none of their competitors will sue them. They all know that; they’re all protected. So really, I don’t know. I’d take a wait and see attitude, but it’s an interesting branding and reputational move for Twitter.

We’re a little bit into the post JOBS Act World. Net-net, do you think it’s long-term positive or negative for startups? What types of risks or benefits will folks be exposed to?

I honestly think it’s going to be neutral. I don’t know that it’s going to change much. I question whether or not the regulation will make it that much easier for startups to raise money. We already have a bunch of different ways for companies to do that. Yes, it addresses crowdfunding. Maybe it’ll help, but maybe not. Once the regulations are set and we have all the details and see what offerings will look like, I think it won’t look all that different from things we already have in place that people just aren’t using. We already have regulations that are supposed to permit small offerings for small companies. Regrettably, it’s a lot of work which ends up being so prohibitive that most companies won’t do it. They’d rather raise cash from accredited investors. If you can’t do that, then you’re just strapped and in trouble. It might help in some places outside of technology, where people have more of an emotional connection with the product or service. It also won’t be as simple as putting up a website and saying give me money, there will be more to it. As for the lessening of public market regulations, while I’m not sure the thresholds are set correctly, I don’t think it’s a bad thing. It’ll help companies, make it a little less expensive to go public and stay public. But really, it will only help the 2nd and 3rd tier companies already on the fringe.

So we just talked about Twitter and Congress trying to address some regulatory issues. What are the biggest regulatory or legal hurdles hurting startups right now?

I think some of the things that make startup life difficult are not as grand as crowdfunding or how to take your company public. On a day to day basis, companies are spending a lot of money on employment and tax issues and that gets costly. 409A is a tax regulation that relates to deferred compensation, and it applies to both huge corporations and small companies. The amount of money and time companies spend on preparation of 409As, special corporate approvals, option plans, and making sure they’re compliant can be quite high. And if the small business gets bought or goes public they need to have another scrub. That costs startups a lot of money and makes CEOs and other founders go crazy. It also makes it difficult for them to incent their employees in the way that they want to, and at the end of the day people are the key.

When a startup is raising a new round, what form of investment do you advise they use, i.e. convertible debt, preferred stock, common stock, etc.?

For startups, you do what you need to do to get funded in the most efficient manner possible for your company. If you’ve got friends or family that are willing to lend you money in a convertible note with terms that aren’t egregious, absolutely raise in a convertible note. If you’ve got investors willing to do it, terrific. It’s easier and faster. The notes have become a little more complex over the past twelve to eighteen months, but they’re still fairly simple and can get done more quickly than an equity round. That being said, lots of investors won’t do it. I tell companies not to anchor on that issue. You’ve got to figure out what’s the most important thing for your company. If some potential investor is the best one for your company and will only do an equity deal, so long as you come to a reasonable valuation, you do the deal. What’s most important is getting the right people behind your company as soon as possible.

A lot of first time entrepreneurs will use a friend or family member as their lawyer to start. Since these lawyers aren’t experts in the startup space, I imagine there are issues you’re forced to unwind. What’s the most typical one?

One thing that drives me crazy is people who set up as a Limited Liability Company (LLC). For a company that’s going to be losing money for a long period of time, why set up as an LLC? You’ve got entrepreneurs, people who don’t really need the losses because they’ve got nothing to write off, and someone convinces them an LLC is easier and more flexible. All it means you have to convert it later on and in the meantime you’ve probably created some issues for yourself you didn’t even know might exist. It’s harder to incent employees through equity with an LLC, there are higher tax compliance costs, and the benefits just don’t outweigh the detractors. Set it up as an S Corp and it’s easy to become a C Corp later. That’s the most common thing with lawyer friends or family. They learned in law school that LLCs are the be-all, end-all to company structure, but for certain kinds of businesses that’s not true. Especially technology startups.

When investors and entrepreneurs are agreeing on a term sheet, what should an entrepreneur be thinking about?

I think the economics of it are really important but it’s not the only thing. You can probably get investors to agree to good economics, but the most important thing to think about is how your company is going to run going forward. It’s governance. It’s how your investors see your role versus how you see your role. If your investors see you as their servant and that comes out in the term sheet, that’s a bad term sheet for a CEO. An entrepreneur’s goal should be to work together as partners with investors to make the business grow and that should be reflected in writing. It’s how detailed the protective provisions are for the investors, what kind of rights the founders are going to have. Yes, there are a standard set of restrictions on founders that you expect to see, and founders shouldn’t fight about it because it makes sense for the company. There are also things I’ve seen that are overreaching and frankly, investors don’t really need that protection if it’s a company into which they want to invest with clean fair documents. Now, if you’ve gone and had your brother-in-law or cousin set up your company, and an investor comes in and needs to untangle the mess, they’ll think the founder doesn’t know how to run the company and will have a more restrictive term sheet. They’ll want to feel 100% protected. It helps to be straightforward and simple out of the gate, and then you can negotiate things going forward from a stronger position.

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I Love to Read

Leave a Comment Posted by on June 13, 2012

I’ve always been a big reader. Whether it’s Stephen King or Fred Wilson, it occupies most of my day, especially because I can’t stop multitasking. I’ve tried to track my books on Goodreads, but frankly I can’t really buy into it. Also, I haven’t found any simple way for me to track everything on the web through one simple application (RSS feeds just don’t do it for me). I’d love to find something great, the closest I’ve seen is Flipboard.

Anyway, here’s a few things I read daily, here’s a few things I’ve read in the past, and here’s a few things I’m reading or planning to read:

Daily – mainly the Web Digest:

News: For technology, it’s TechCrunch first and foremost, not exactly a surprise. After that, I’ll dive into Techmeme, AllThingsD, VentureBeat, and Hacker News. For current news, I used to get the WSJ but stopped, which means because of paywalls I don’t read it anymore. I love reading newspapers but that’s just such a huge effort. For international and New York news, I love the NYT’s coverage. Sports, I guess I use ESPN but that empire is very overbearing. For investigative reporting,  I don’t think anything touches the New Yorker. And for all news combined, Twitter’s the easy answer. I also like Term Sheet, which is actually a daily email Dan Primack at Fortune for VC/PE related news. And Charlie O’Donnell’s weekly update on all activities and meetups. Besides that, I have a Bloomberg terminal at work that covers alot of ground.

Individual Blogs: Fred Wilson at AVC.com is my favorite. It’s a yeoman’s effort to post daily (I’m at twice a week and I think that’s tough). His voice is one of my biggest personal influences. I love Chris Yeh’s writings at Adventures in Capitalism. He spans a lot of material and topics. It doesn’t matter if it’s personal, professional, or slightly taboo, he’ll address it. Mark Suster and Both Sides of the Table. He doesn’t post all that frequently but I’m constantly on the lookout. His posts are thoughtful and in-depth. Chris Dixon’s blog,Charlie O’Donnell’s This is going to be big, and Roger Ehrenberg’s Information Arbitrage deserve huge mention.

“Gossip” style sites: I constantly check Dealbreaker for finance-related news. The content is either infuriating or funny, depending on how you feel about financial institutions. I check out Zerohedge too, but that gets a little too paranoid for my tastes. And Deadspin, the pre-eminent sports gossip site. Drew Magary is a genius of a writer and one of my favorite voices on the internet. Check out this incredible post on the terrifying pre-mature birth of his son and good luck not crying. The guys at Kissing Suzy Kolber are fantastically obnoxious.

Things I’ve Read Recently:

World War Z by Max Brooks. I didn’t know what to expect but it was awesome. I wonder how the movie will turn out.

The Hunger Games by  Suzanne Collins. Heard of it? Interesting premise. I know exactly how the movie turned out. How disappointing.

Steve Jobs by Walter Isaacson. It’s just amazing to watch the ebbs and flows of his life and career. He was a mesmerizing character. Oh, I’d also check out this interview he did with Playboy. He basically predicts the future in 1986…

Battle Cry of Freedom by James McPherson. I figured the Civil War was one of the most important turning points in our history, I might as well learn some more about it. Fantastic book.

Books I Love

Ender’s Game by Orson Scott Card. It’s tough to explain why, but I’ve read this book probably ten times over my life. It’s the story set in the future of a young child of incredible intelligence asked to protect the human race against an alien invasion, but first he trains at a battle school with other prodigies. It sounds stupid but it’s my favorite book I’ve ever read.

Stephen King’s the Dark Tower and J.K. Rowley’s Harry Potter. Okay, so it’s a series not a book. And it’s strange to throw them together, but they’re full imagined worlds. King’s is even more impressive probably because he built this whole mythology and story line that’s fed through all of his books, including The Stand, another masterpiece of his.

Rosencrantz & Guildenstern are Dead by Tom Stoppard. Okay, so it’s a play. It’s absurd and excellent. Such a fast simple read but so enjoyable.

An Unfinished Life by Robert Dallek. It’s an in-depth look at the rise of Jack Kennedy from birth through his untimely demise in Dallas. The parts around the Cuban Missile Crisis are incredible.

The Power Broker: Robert Moses and the Fall of New York. Not being from New York, I had never heard of him until I stumbled across this immense book (in both scope and length. It took me 4+ months to read which never happens). It’s incredible to watch an idealist fail, sacrifice those ideals for power, and watch that absolute power corrupt. It’s also incredible that one man is so responsible for how New York is laid out today.

Things I’m Reading/Plan to Read:

Peter Theil via Blake Masters. Theil taught a class at Stanford last semester and Blake captured all the details of it in his notes. It’s insight into the mind of one of the cannier investors and entrepreneurs of the last few decades.

The Founders’ Dilemna by Noam Wasserman. It’s a detailed and analytical approach to why things fall apart for founders.

Song of Ice and Fire: Okay, so I’m caught up to date already but I’m restless for the newest book from George R.R. Martin.

Anyways, I’m always open for more suggestions. Found anything good to read?

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Inventing Technologies and Engaging Consumers: Sonic Notify

Leave a Comment Posted by on June 10, 2012

Bill Killoran is a developer at Sonic Notify, a spinoff company from design firm Densebrain. This is normally the point where I explain what someone’s company does, but frankly, I’ll leave that to Bill in our interview. It’s an impressive brand new technology that lets companies interact with people in an innovative way, I’ll say that much. I met these guys originally at a Meetup fundraiser for HackNY during Internet Week.  A little after that, Bill and I got to catch up in my favorite manner: over beers. For more about Sonic Notify, check out their blog.

So all the guys at Sonic Notify worked at Densebrain together. How did Sonic Notify come to be?

We had this one proprietary product from Densebrain called NYCMate. It’s a really good subway locator that had timetables and other stuff. We basically used crowdsourcing to predict when trains were going to show up at stations because the MTA’s timetables were never really accurate. So we had this really good crowdsourcing system, it already worked great. But we wanted to take it further. So something Alex (ed. note: Alex Bell, co-founder and inventor of their technology) thought of was to put these little beacons that would emit sound in buses. When buses reached certain points, you would have listener beacons that would hear that sound and broadcast across the system it had arrived. So we had the same crowdsourcing engine for buses that we did for subways. Unfortunately, the MTA wasn’t crazy about it and wouldn’t do it. So we decided to take it in a new direction.

It’s a shame. It would have been totally passive, simple, and cheap. Just put it on the bus and at the listening spot. Whatever, that didn’t work. So we took it to the supermarket aisle. Jon (ed note: Jonathan Glanz, CEO and co-founder) and Alex pitched the idea to Proctor & Gamble in Cincinnati and they loved it. We saw it going somewhere, so we wound down Densebrain as a development and design agency, and wound up Sonic Notify. We officially became a company in late fall.

So I understand the general idea of the technology, but can you talk about your actual product?

There’s two main parts. Something emits a frequency above the human auditory range and basically just beeps out a code. That code is a pointer to information on our servers. Second, you have a device listening to it, like a phone or computer. The listening device says “I just heard this code, what does it mean, what do I do?” It retrieves information for our server, and you can receive a lot of information and instructions that way. A lot of people get confused because they think we’re actually encoding a tremendous amount of information via sound, but it’s really just pointers. Otherwise it’d be totally inefficient.

You guys have had some pretty strong partnerships already. You’ve worked with Lady Gaga, Katy Perry, Coachella, and MADE at New York Fashion Week. What have you learned from that?

We learned that everyone loves the idea, is really crazy about it, and sees the potential. But not everyone has the development team to pull aside and execute what they want to do with it. Our original intention was just provide the Software Development Kit (SDK) and development teams would do their thing with it. We’re kind of in an agency position again though. People would come to us with an idea and we execute it for them because they didn’t have the team or resources. It worked out great because of our Densebrain experience. Personally, in the future, I’d like to be less of an agency and more of the technology guys behind it.

One of my initial impressions was how similar this was to Minority Report, where there was an instant identification between advertisers and people based on eye recognitiion. Is something like that possible in Sonic Notify? Could a device return information to your beacons?

No, but that’s a positive though. We want our sensors to be dumb. One emits a frequency, one receives. Your phone never broadcasts anything unless it’s part of the application that includes our SDK. There’s no information that you get from us that you couldn’t get from part of Xcode or whatever SDK you’re developing in. When people hear the word inaudible, or subliminal, and think “Oh my god, we’re being attacked!” But we’re not really that evil.

So you’ve officially been a startup for over half a year. A constant refrain I hear is how helpful and friendly the New York startup community is. How’s your experience in it?

It totally is a community. I’ve been going to Meetups basically every week for the past year and a half. It’s a lot of fun to see what people are up to and what they’re doing. You say “Oh, I remember being in that exact situation that startup was in.” At Densebrain, we saw almost every staggering high and every crumbling low a startup goes through. But if we haven’t dealt with it before, I’m sure there’s someone else at some Meetup who has. It’s really exciting.

What are your favorite Meetups?

I like the more esoteric ones. I’m a member of Ladies Who Code, just to be ironic. I’m a big fan of New York Tech Meetups and mixers, because they’ve got free booze and good ideas.

I saw the guys at Sonic Notify were at TC Disrupt’s Hackathon. How was that experience?

It was okay. It was a lot more intense than we thought it would be. We thought we would spend eight hours there, come home, and just show up in the morning. Not even close. We wound up working to the last second. We tried to use our SDK in another product. The problem is Sonic Notify is really complicated. Because you only have sixty seconds to pitch your product, it’s tough to describe our technology and product to people in that short time frame. You try to downplay it, but even though our idea was cool, we just didn’t have enough time to present it.

What was your idea?

Contagion. Disrupt Hackathon had this thing where companies would give prizes to people who used their API. There was this one company called Mobli that would give ten thousand bucks to whoever used their API in the most creative way. Their company statement had an image that really resonated with us. You’re at a concert, you have horrible seats and can’t see anything, but you can see everyone’s holding up their phones. You think, wouldn’t it be cool if I could everything they see all at once? So we thought up Contagion, something similar to a virus.

Basically, what it would do, is if your phone heard a Sonic Notify signal, it would be “infected.” It would broadcast that frequency in turn, and then take a picture every couple seconds of whatever you were looking at. In effect, it would make Mobli’s vision a reality. If you were at this concert, someone would start the contagion, and everyone’s phones would take pictures and post to a photo wall every couple seconds You’d get this really colorful snapshot of this entire moment of time spread across everyone’s devices. It just needs more than sixty seconds to explain and more than twenty-four hours to develop. It was like a mosaic of a specific moment. This is where Sonic Notify shines. You link a moment to a specific position. No other SDK or core location framework in the iPhone can do this like we can. It was really exciting, didn’t turn out as well as we thought, but it was fun to do. We’ll do it again. We have all these cool ideas, and never an excuse or time to do it. I’m going to try and enter more hackathons and encourage everyone there to use our SDK.

What’s the most creative use of your technology you’ve seen?

We had this one idea for a show we’ll call “Procedural Crime Investigation,” something similar to a C.S.I., on like CBS or something. It’s a detective show, where they have to find a murderer, etc. J.O.B., one of our guys at Sonic Notify, came up with this amazing design wireframe, where you basically have a companion application and you help the detective find the murderer. And you can only contribute if you watch the show at a certain point in time when our beacon comes into play. The concept is cool. You get info as the people in the show get it.

I’m also a fan of what we did in Fashion Week. You got real time looks as the models walked. I can’t think of a situation where something was this to the second. You can get a professional photo within a second of it being shot on the runway.

I can see a world where Sonic Notify takes off as a way of engaging consumers. How do you prevent it from becoming spam or too overwhelming?

Well, you can’t participate if you don’t have the application or if you’re not opted-in. Your phone needs to be listening for you to get any alerts. We do have some tricks so your phone only listens at the right point in time. We have location triggers, so you’ll only listen if you’re within a certain radius, or time triggers. But really, it’s up to the people who develop the applications to not overwhelm their users. If it doesn’t work, users will delete their app. Sonic Notify can’t control that.

Who’s your biggest personal influence?

I’m a big fan of Ben Nadel who works at a Startup called InVisionApp, which is a prototype development company. You can create mockups that are really functional really quickly. Just he loves jQuery and loves blogging about jQuery and I also love JQuery. I’m a big fan of rapid prototyping. I think they’re a really cool company that does something I wish more people would do. I work with designers that make quick wireframes, basically just gray and black boxes, saying this need this, that needs that. Then after a week or so, they’ll actually hammer out what it looks like. InVision does both at the same time. Check it out, it’s fun.

Alright, maybe my favorite question. What’s the best startup you know out there?

I’m sorry, but we’re the actually the coolest guys around. We’re cooler then a cucumber wearing sunglasses. I don’t think anyone else is as ballsy or gutsy as we are.

Entrepreneurs

Do the Right Thing: Loyola’s After Fives

Leave a Comment Posted by on June 6, 2012

For those of you who don’t know, I got my undergraduate degree at Loyola University Maryland (né Loyola College, or LoCo) in 2008. One big joke at school was you were from Long Island, outside Philly, or anywhere else. Though born anywhere else, I live in New York now. There are tons of alums living in the city. According to Loyola, it’s the largest concentration of alums outside of Maryland. It’s a strange thing, though. Even with such relatively big numbers, if you asked me to introduce you to someone in a certain industry or at a firm, I couldn’t shoot an email to anyone outside my friends. I don’t think there was a culture that encouraged students to reach out to alums, alums to reach out to each other, or leverage Loyola’s professors and their networks. That was my experience for the first three years since college. On the alum-to-alum side, I’ve recently seen progress.

In the last year, things done changed. While some of the additional school spirit (read: open bars/drink specials) can be attributed to things like our first NCAA basketball tournament bid since ’94 and our first NCAA lacrosse championship since… ever, I don’t credit that our increased community involvement. I credit that to our  NYC Alumni chapter leaders, including our former President Chris Coyle (’90, MBA ’93) and Peter Mullahey (’89). What’s gotten me most involved has been something called the “New York After Five” events.

The After Fives were held for a few hours at an apartment or elsewhere and consistent of some mixing over beer and wine, and then a talk with a very informal Q&A session and more mixing afterwards. The first one was held at Chris’ apartment and featured Tom Kuegler (’94), TK, of Wasabi Ventures. TK gave a no-holds barred talk on all things venture, startup, and technology. I was able to get TK’s information, and since then he’s been a very strong voice of reason for me and led me to a great interview with his partner Chris Yeh. The second meeting with was Greg Gortz (’02) and Bostjan Spetic, of Zemanta fame and it took place at USV. We talked about a lot of the same things Greg and I talked about here, and, though I considered it, I didn’t liberate anything from the House of Fred as a souvenir. After that, we got Chris Dessi (’97) of Drive Action Digital, to talk about exactly what social media strategies work for whom. By the way, if you work at an antiques auction house that caters to an elderly audience who doesn’t know what the internet is, Chris says don’t even bother with social.

These events have done more then any game watch or bar event ever has. When I go to Public House or some other open bar, I’m not forging any new connections or meeting any new people and I suspect neither are the other alums. Through the After Fives, I heard alums give expert talks about their industry. I developed meaningful relationships with those speakers and with other people there that paid actual and real dividends in my life. When I needed to meet someone in the venture community, all I had to do was reach out to our chapter and they put me in touch with who I needed. They leveraged a network that I didn’t know existed.

Look, so far there’s only been three After Fives, and I don’t know anyone outside of Loyola’s NYC chapter that’s done it. But I know it’s worked for me and the other alumni there. We’ve spread the good word, and in subsequent events, more have come. I’ve already been able to get really great things both professionally and personally. It led, through some twists and turns, to the creation of this blog and many of its posts.

Loyola and Loyola NYC, if I could give you any recommendations, it’s to keep doing things like this that actually engage us as alumni. I’ve made real connections and those connections have helped me tremendously in a very short time. I’m obviously willing to return the favor, but make it easier for me. Help me stay in touch with other alums, through things like this. Take the momentum from the last few months in sports and events like these, and build on it.

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Tagstand and the NFC Revolution

1 Comment Posted by on June 3, 2012

Omar Seyal is a co-founder at Egomotion, Corp., which owns and runs Near Field Communication (NFC) business Tagstand. Tagstand, a Y-Combinator backed startup, wants to be at the forefront of this technology, both from a B2B and B2C perspective. Omar’s got over five years experience at tech startups and over ten as a software developer. Personally, I really believe NFC and the whole concept of touch-and-go experiences are the direction things are going (imagine only needing to carry your phone instead of credit cards and IDs, that’s what it can do). Omar was gracious enough to talk with me about the industry, what Tagstand’s doing, and where things are going. You can follow Omar on Twitter at @omarseyal, while his home base online is http://omarseyal.me/.

So, for those who don’t know, can you start off by explain what NFC is and does?

Effectively, NFC is the intersection of offline and online experiences. You can just touch things, and that makes something else happen. You can call it a bunch of things: tap-to-X, NFC, micro location identification. But the reality is you can turn a small gesture, a tap at a specific place, into anything. Anything can be posting to Facebook, recording an email, making a payment. It could be the acquisition of a coupon. It could be two phones exchanging information. It’s just the capacity to take a very specific action, a tap to a very specific place, and react to it computational and programmatically.

Great, so that’s the background. Can you talk about what Tagstand is doing in this space?

Basically, the analogy we make, and it’s a big one, is in the early days of PC’s, a bunch of people were just way into it and a bunch of other people thought it was dumb. You could see it had this huge revolutionary capacity. It added computing power to everyday tasks. And so, people formed little companies that got in touch with the hobbyists, then they kept growing and growing until some of them took off. We feel that way about sensors, like RFID and NFC, and specifically NFC because there’s a standard around it. Just over a year ago, we could see there was a small community forming. People really wanted to use the technology and it made its way to early adopter phones. We also saw a need. The hobbyists didn’t have a place to get passive tags. They didn’t have anyone building libraries for them, being their advocate. It was entirely B2B. And if you think about it, most great technologies don’t take off if they’re just B2B. So we tried to fill the gap and play with the hobbyists, and that’s how we started Tagstand. If you notice, our site looks like it’s for hobbyists, and it is.

So we sold tags, and we started getting leads on what people wanted beyond tags. They wanted a way to take tags and change content, without actually reprogramming them. So we created Tagstand Manager. We started getting leads from larger companies, like Nokia saying they’d love to use that in their advertising deployment. So we kept playing and paying attention and joined forces with this guy Josh Krohn. He wrote NFC Tasklauncher. We noticed he was on the same path, not doing it full time, but he was making NFC more useful. In his case, he was writing an app for the phone that extended the capabilities of NFC beyond just the standard. The standard says you can open a website or a block of text when a phone taps a tag. Josh made it so you can execute really complex macros using applications. Join a phone to a wifi network, or Bluetooth network, or both just by tapping to one tag. You could change the background of a phone, install two applications. So anyway, we got him to join the team and got the application on board. That’s kind of of what we did with phones and tags. We just view it as working with hobbyists to make NFC more and more useful.

On the flipside, NFC has tons of applications without phones. If the first is B2C, with phones as the primary consumer tool, there’s also a chance to build infrastructure for people starting companies using hardware. So that’s kind of of where this whole events thing started. It would be really cool to make hardware that’s programmable or usable like software. So we made these little readers and little tags, so that the interactions between them are configurable using software. So if we go to an event, and say we have ten thousand tags and twenty readers, you can just program what information is bound to each tab and what it will trigger. So it makes for a very flexible platform, and it’s growing in flexibility, usability, and customizability. You can use the same platform, of readers and tags, or bracelets, or cards, for loyalty, or any number of product ideas. That’s the road we’ve gone down.

That leads me to my next question. I actually discovered Tagstand through a Tech Crunch article where you NFC-enabled the New York Public Library’s opening gala. How did that experience go?

That was fun. I don’t think I’ve ever done an event that was that fun, or worked one at least. It wasn’t just fun, it was incredibly insightful. The numbers that we got out of that event were shocking, for a first time big scale affair. We had never done anything at that scale. With very low promotion, 30% of the guests used the bracelet and actively tapped. On average, that person tapped eight times. Of those eight times, 20% of those taps translated into Facebook posts, likes, or tweets. That’s a remarkable number. A third of the attendees basically tweeted about the event. If you think of the broadcasting platform that creates, it’s quite good. We were really encouraged. From a technical standpoint, we were also really encouraged. We only had one failure at the event, but it was eighty readers and due to a quick WiFi issue. We just set up a quick 4G hotspot and solved it.

We’re still at the stage where we need to be very attentive to our own hardware and applications, and in some ways we consult for ourselves. It’s very encouraging to see that we’re only a couple feet short of a turnkey solution, where someone buys hardware from us, configures it through web services, and anyone can use it. Then we just take a fee.

One concerning thing about NFC technology is the lack of consumer adoption. It’s frequently touted as the next big thing, but it’s not in everyone’s hands or they don’t know about it. What’s standing in the way of widespread adoption?

So, it’s funny because people say that and they mean it’s not on all phones. I guess that’s why we go after the second route, around events. Most of the adoption issues are B2C, because they’re dependent on phones. The main barrier is effectively time. I would challenge you to think of one major feature that’s reached one or two flagship smartphones and has failed to reach all smartphones within x-years. NFC has made its way to a flagship smartphone, you would expect over time it would reach all smartphones. The barrier is just time.

From a B2B adoption standpoint, it’s pretty much been adopted. They just haven’t adopted it so it’s integrated with consumer experience. We see hotels using NFC cards, we’re seeing NFC and RFID chips in credit cards, when we drive and people use FastTrack or EZ Pass, that’s RFID. We see it adopted by businesses, so there’s nothing to be concerned about. The consumer is just waiting, but there’s an inevitability that it’s happening.

Through Tagstand’s short history, what’s the biggest thing you’ve learned so far?

I guess, when the three of us got in here, we tried to think of cool revolutionary things to do with NFC. The reality is the whole tap-to-X experience is revolutionary in and of itself. You can do very mundane things, but if you make it happen with a simple tag it makes it a bit revolutionary. We did a lobster roll event a little while ago, and instead of filling out a card, they just tapped a station sitting outside of the food stand after eating. The customer engagement was 3x greater. Often, it lowers the barriers to act greatly. It’s that people can do it so much easier and it makes the experience easier as a whole.

What’s up next for Tagstand?

Focusing on the web services that underlie the events platform, that’s a big deal. Making NFC Tasklauncher more feature rich, so people can do even more creative things by just tapping their phones to a passive tag. We’re focusing on those two, but we’re going down the road open minded. As we see people doing cool things with NFC, we’re happy to branch out and look into new projects.

Who’s had the most influence on you from a professional standpoint?

PG. Paul Graham. I know, it’s the easy answer. When we first sat down with him and talked about Tagstand, he was pretty excited. We kept complaining about the NFC environment’s infrastructure, world, and community. He told us we were looking at it wrong. We needed to be the ones to bring the NFC revolution to the world. That’s what Microsoft did. They knew there would be a computer on every desk and they wanted their software running on that computer. That’s how we look at it. There’s going to be a lot of ways for you to use NFC to connect the world to your apps and devices through which you live.  We want those apps to interact easily with NFC passive tags or devices. I think that was a very clarifying moment for us. We looked at the NFC community and realized we’re not just a part of it, we’re advocates of it, and we’re going to make it work. It’s empowering and it gives you a very specific vision at the company.

Alright, last question. What’s the coolest startup that you know besides Tagstand?

I like Askolo. It’s like some combination of a fireside chat and Quora. I can’t explain it better than that. It’s cool because people answer questions about themselves in a Quora type environment. You end up with a wiki about a person which I think is pretty useful. It’s almost Facebook to me, in terms of getting to know something about someone.

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