Byzantium, a bootable Linux with "Ad-hoc wireless mesh networking for the zombie apocalypse"

The Doctor [412/724/301/703] [ZS] sez, "Project Byzantium is a working group of the HacDC hackerspace, and is a live distribution of Linux for easily and rapidly deploying ad-hoc wireless mesh networks for the purpose of emergency communications. They presented last weekend in New York City at HOPE Number Nine and announced their second major release (v0.2a) on stage. They also gave away 500 copies on CD-ROM at the conference. They held workshops all weekend on how to use and test Byzantium Linux, and now they've released the .iso image of this release to the Internet. (Thanks, The Doctor [412/724/301/703]!)

from Boing Boing http://boingboing.net/2012/07/20/byzantium-a-bootable-linux-wi.html?utm_sourc...

An Algorithm to Decide Who Gets a Meeting with VC’s

With so much talk of “big data” disrupting industries, can it radically change venture capital? Technology Review had a piece recently on a new VC firm using algorithms to help it screen investments:

The $1.25 million was a follow-on investment from Correlation Ventures, which calls itself a “new breed of venture capital firm” — one driven by predictive analytics software built over the last six years by founder Coats and his partner Trevor Kienzle. The effort adds efficiency to the investment process. And for entrepreneurs, it means far faster answers: rejections come in as little time as two days.

To run its model, Correlation Ventures, which is based in San Diego and Palo Alto, California, asks startups to submit five basic planning, financial, and legal documents. It enters these into a program similar in function to credit rating software.

A top-ranked score leads to a 30-minute interview with both the startup CEO and the outside venture firm leading the investment, plus a quick legal review and background check. As a co-investor, Correlation Ventures always relies on some vetting by the primary investor.

The last time I wrote about something like this, I talked to VC’s who emphasized the importance of relationships in this process. Remember: the best entrepreneurs get to choose which VC’s they go with, and might not like being filtered by an algorithm.

What I do like about this is how data is being used to improve, rather than replace, VC expertise. If the algorithm can act as a reliable filter, that frees up time for VC’s to do even better due diligence on the companies that are under consideration.

The other thing I brought up in my previous post was that this kind of modeling could potentially be really useful in the crowdfunding space. As I wrote then:

Someone is trying to bet $1,000 on a startup that the data indicates has an extremely low chance of making it to its next funding round according to the Compass’s modeling. That investment could be prohibited or, even better, just set off an alarm that raises the requirements for completing the investment. Want to invest in a company that the data suggests is about to fail? No problem, but you have to talk to a platform provided investment officer first to ensure you understand what you’re doing.

I’d love to see crowdfunding platforms seeking out partnerships to make this happen.

Anyway, to sum up, I’m hopeful that data will [continue to] improve the ability of venture capitalists to do their jobs better. To supplement their abilities, if not replace them. As for total disruption, I doubt it.

from BostInno http://bostinno.com/2012/07/18/an-algorithm-to-decide-who-gets-a-meeting-with...

Massachusetts Saw a Serious Uptick in Series A Deals in Q2 [Data]

Q2 venture capital data from CB Insights leaked Monday and it turns out it was a banner quarter, the best in over a decade. What about for Massachusetts? We’re down significantly from a year ago.

But the data’s not all bad for the Commonwealth. Here are a few key findings from CB Insights’ report:

  • Deal activity remains consistent with Q1 2012, but funding increases 18%. YoY, deals and dollars have gone down 18% and 33%, respectively.
  • Healthcare barely maintains top position in funding share, but internet convincingly leads Massachusetts in deal share. Meanwhile, Energy easily retains its #3 spot in terms of funding.
  • Healthcare, which took at least half of VC dollars over the previous four quarters, falls dramatically. Internet and mobile both hit 5 quarter deal and funding highs.
  • On the back of a strong quarter for Series A, early stage deals rise to a five quarter high in deal share.

Here’s a deeper look at the data:


I’m particularly encouraged by the surge in early stage activity. And remember, that’s just Q2, meaning up through June. In the last couple of weeks we’ve seen:

And that’s just a quick flip through our archive – I know there are ones I’ve missed. Sure, some of that is probably going to be offset by a slow August, but still.

Despite the fact that overall funding levels are down from a year ago, there are some positive signs.

from BostInno http://bostinno.com/2012/07/18/massachusetts-saw-a-serious-uptick-in-series-a...

“VC is a Trust Business” (Part 1)

We met with some of our large investors recently, and one of them mentioned: “VC is a trust business.”  He was saying that he trusted us.

I’ve been thinking a great deal about what he said.  I think trust in venture capital is critical, and it is something that covers multiple dimensions.

For starters, we think that VC is a business just like any other.  As such, it has stakeholders:

  • The entrepreneur: we think they are a VC’s customers
  • The investors in the fund: they are called “Limited Partners”
  • Partners in the VC firm: these are the folks in the legal docs and are named as part of the “General Partner.”
  • Non-partners in the VC firm: they may include Venture Partners, Partners, Principals, Associates, finance executives, office managers and executive assistants.  Some of these folks may have some investing role, but they’re not partners if they’re not in the legal documents

We think that stakeholders are like legs in a chair.  When one is wobbly, the entire structure is de-stabilized.  One major wobble factor: dis-trust.

In this post, I’ll cover the importance of trust between an entrepreneur and a VC.

First, let’s look at trust from a VC’s standpoint.  When he invests in a start-up, he needs to have a lot of trust in the entrepreneur.  That’s because the VC is there for board meetings and assistance, but is essentially an outsider.  An entrepreneur can lie to the VC.  Lies will eventually be discovered, but it will take a long time.

For example, one founder I know started a company, received a lot of venture backing, and later, secretly started a new business and shopped around for a financing.  I know this because I am the first VC he approached.

You see, I had invested in his earlier company, and left that board when I started Kepha (which is the customary protocol in VC).  He later approached me a few times in secret about his new idea.  I told him I was uncomfortable.  I did not want to betray the management team, whom I had worked hard to recruit to that venture.

So, I told him I would start diligence only after he came clean with his current board and colleagues that he wanted to leave.  He wasn’t willing to do so.  He then approached me a few more times, and I continued to stick to my guns.  I told him I didn’t understand why he wouldn’t tell the truth.

In the end, he approached other firms, received funding, and then quit from his original start-up.  His previous management team was completely shocked, disappointed and hurt.  No executive from his old team joined him at his “new” venture.  He lost their trust.

Now, let’s look at trust from an entrepreneur’s standpoint.  Trust here is critical.  The VC can fire the entrepreneur, but the entrepreneur cannot fire the VC.  It is an assymetrical power relationship.  Yes, the VC’s reputation is at stake if he behaves badly.  But, the reality is that he can fire the entrepreneur, or decide not to invest in the next round, which is a negative signal to any prospective new investor.

So, it’s very important that start-ups can truly trust the VC.  Here’s a very real example.   One CEO, hired by a founder, was raising money for a start-up.  My partner Eric really liked the idea but told him that he did not think he was the leader for the start-up.  The CEO was insulted and shopped the financing elsewhere.

Three VCs at well-known firms decided to invest.  They too thought the CEO was not back-able.  But, they decided together not to tell him that, as they didn’t want to lose out on the investment.  So, they invested.  One month later, they fired the CEO and appointed the founder to lead the company.  Unfortunately, the CEO had moved his entire family to be closer to the start-up.

Now, I think 99% of the VCs I know will be very honest about their thinking.  So, this isn’t an indictment of VC “bad behavior”.  Bad behavior exists everywhere, in all circles.

But, I want to emphasize that it’s very important for the entrepreneur to get to know a VC.  Take your time and get to know someone.  Do a lot of reference checking.  Understand who the VC is and why he is working as a VC.  Don’t be overly enamored with a firm’s brand.  Then, trust your gut.  I always tell my entrepreneurs: it isn’t about a firm’s brand, it’s about that individual VC.

So, it’s about trust.

I’ll write in future posts about trust with other stakeholders….

from BostInno http://bostinno.com/channels/vc-is-a-trust-business-part-1/

Nodeable gives Hadoop a real-time boost with StreamReduce

Just when complaining about how slow Hadoop is starting to become a popular pastime, here comes someone that says it can help solve the problem. Nodeable (see disclosure), the company that launched last year as a Twitter-for-systems-management play, has made a shift in its business strategy and is now offering a cloud service for processing and analyzing streams of data in real time. Its new flagship service, called StreamReduce, is built atop Twitter’s open source Storm framework and acts as Hadoop’s faster, nimbler front-end partner.

To understand how StreamReduce works, it’s helpful to take a look back at how it came to be. As it turns out, Nodeable Founder and CEO Dave Rosenberg told me, the company realized quickly it needed to do something different if it wanted to add value in the systems management space, and that something was analytics. Rather than just produce a stream of tweet-like alerts to sysadmins, Nodeable would actually alert them to anomalies and emerging patterns that might signify a bigger problem to come. In doing that, Rosenberg said, the company realized it had actually created a real-time complement for Hadoop.

Fed up with systems management (it’s hard to do a repeatable cloud service in that space, and no one wants to pay for systems management, Rosenberg said), Nodeable, with support from its customers and investors, decided StreamReduce was its real business. “Between Cloudera [whose CEO Mike Olson is on Nodeable's board] and Hortonworks, it took us five muntes to find more customers willing to pay for this than we we thought we could find managing AWS,” Rosenberg said.

It works similarly to the original Nodeable product — and the UI will be familiar to legacy users — but the use cases are as broad as customers imaginations. Clickstream analysis, systems monitoring, fraud detection, you name it. Essentially, users define the metrics they want to monitor, everything hits StreamReduce as a JSON file, and the system analyzes it and delivers alerts around counts, patterns and anomalies in real time. Once that’s done, it can feed data into Hadoop for more in-depth batch analysis later on.

One beta user that happens to be a major web retailer has been using StreamReduce to try and determine why customers are abandoning their online shopping carts. It’s tactic was to analyze shopping cart abandonment against slow-loading product images from Amazon S3 and negative comments on Twitter and try to determine any correlations. Doing all this after the fact using Hadoop only wouldn’t be much use as the problems were occurring.

For the web-stack aficionados out there, StreamReduce runs in the Amazon Web Services cloud, using a collection of AWS tools, as well as MongoDB and Amazon’s DynamoDB. Although, Rosenberg said, MongoDB — the most-mature NoSQL option at the time Nodeable started building — might get swapped with Cassandra later this year. For Nodeable’s high-scale use case, MongoDB just isn’t the right fit.

Disclosure: Nodeable is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, the founder of Giga Omni Media, is also a venture partner at True.

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from GigaOM http://gigaom.com/cloud/nodeable-gives-hadoop-a-real-time-boost-with-streamre...

Google+ API Opens, to Attract More Businesses




Google on Wednesday announced it will expand its third-party API partners for Google+ beyond the initial six to include "hundreds" more over the next few weeks.

The announcement, relayed in a Google+ post by Product Manager Eduardo Thuler, could lead to greater adoption of Google+ by businesses. Google rolled out the beta version of the program last November, a couple of weeks before it began letting brands launch their own Google+ pages. Initially, the partners were Buddy Media, Context Optional, Hear Say Social, HootSuite, Involver and Vitrue. The company acknowledged at the time that although companies could manage their Google+ pages directly, "we also recognize that some businesses u…
Continue reading...

More About: APIs, Brand pages, Google, Marketing

from Mashable! http://mashable.com/2012/07/19/google-plus-api-businesses/?utm_source=feedbur...

Agile is Better, Not Perfect

“Have no fear of perfection – you’ll never reach it.”

― Salvador Dalí

“I’m a perfectionist.”

Some people say it with a sense of pride as if they’re the only people who like to deliver quality work and everyone else is sloppy. God forbid someone ask them to hurry it up; those people must not understand what it’s like to be perfect. The label of perfectionist, to me, is equitable to control freak, and neither one is a good thing to be on a team. Perfectionism is anti-Agile; it can slow or halt a project.

The confusion about perfectionism being good or bad stems from a simple misunderstanding of how perfection works. There are times when perfection arises and can be admired, but the key thing to understand is that it disappears as quickly as it appears.

Perhaps the perfect design has been made. But Oh look! Here comes Steven; he notes that the budget for the project got rearranged and there is less money for development, so feature X needs to go. That perfect design is now wrong. There can be a lot of moaning and groaning and finger pointing, but after working in design for 20 years, I can tell you for a fact – this is just how projects go. New circumstances come up, mistakes are made and people take risks that don’t pan out. Instead of being surprised and angry when things change and mess up your perfect plan it would be much better to understand that this is all part of the process of creation.

For us at Beehive, this means that we try to be as Agile as our circumstances allow. I’m not going to go into a full run down of how an Agile process works; there are a million and one places on the web to review that information. To quickly cover the basics for those of you who are not familiar with the process: it’s about breaking a project into parts that get done in short bursts (2-4 weeks) that are then checked, tested and refined. In order to have something that is in a testable state, silos need to be knocked down and people need to work concurrently. A product then can be released in phases to get feedback in order to make sure the project is going in the right direction. There are some benefits and some difficulties in working this way.

Benefits:

  1. Safe environment: People feel more comfortable making suggestions and comments if we all work on the project together from the start.
  2. Buy in from all stakeholders: As the project moves forward the participants understand why decisions and compromises were made so that a perfectionist doesn’t walk into the room and try to halt the project because they don’t understand how it came to be the way it is.
  3. Emergency Brake: A project path can be shifted before the resulting product has taken on a life of its own. (We’ve spent two years and $600,000 on it…let’s just pretend it’s what we need.)
  4. Risks are ok: There is an understanding that there is probably more than one solution, but instead of trying to come up with every solution for every possible circumstance you can move quickly because you pick a solution, not necessarily the perfect solution. Then you use feedback to build closer to the best solution for the need.
  5. Speed: Momentum keeps things going at a quick pace so the products that are released are relevant to the marketplace. (If the marketplace shifts every year, you can’t take two years to make a product.)

Difficulties:

  1. Change scares people: Historically, most projects have been done in a waterfall process (you do your part, then I do my part, then I pass it to that guy over there). Having to share control of “your” part can be uncomfortable at first.
  2. I need it in writing: One of the goals of agile is less formal documentation. This requires an element of trust that a lot of us just don’t have yet. (This goes both ways…you trust that I was listening and I trust that if I do get it wrong or need to change something you won’t freak out.)
  3. I am a Roadblock: Agile is meant to be collaborative. In order for a collaborative project to move forward, everyone needs to be ready to participate when they are needed. In our overworked society, people can have something sitting in their inbox for days before they even look at it, which can hold up a project.

In a pure Agile process these difficulties are addressed, but a pure Agile process doesn’t necessarily work for everyone. Maybe it doesn’t work because your company doesn’t all work in one office or maybe you have clients that are tied to their own process. The value of Agile lies in its flexible, adaptive nature. Often times it becomes essential to adapt your process as well. When you live in an Agile environment, that can be achieved in order to deliver the best results.

Image via Dbenson and VersionOne, Inc.

from BostInno http://bostinno.com/channels/agile-is-better-not-perfect/

Objective-C and Cocoa: The core of solid iOS apps

Jon Manning (@desplesda) and Paris Buttfield-Addison (@parisba) are co-founders of Secret Lab and authors of the forthcoming Learning Cocoa with Objective-C, 3rd Edition

Key points from the full video (below) interview include:

  • Embrace Objective-C’s verbosity [Discussed at the 0:30 mark]
  • Just getting started with Objective-C? Check out the WWDC videos and… [Discussed at the 1:45 mark]
  • Long awaited updates to Objective-C make a big impact [Discussed at the 2:27 mark]
  • When it comes time to submit your app to the App Store, think about it as Apple would [Discussed at the 3:47 mark]

You can view the entire interview in the following video.

Related:

from O'Reilly Radar - Insight, analysis, and research about emerging technologies http://radar.oreilly.com/2012/07/objective-c-and-cocoa-the-core-of-solid-ios-...

How I Work: Bijan Sabet of Spark Capital

Editor’s Note: With the launch of our Careers platform, we’ve been writing a lot lately about jobs and work. And, inspired by a great post by Brad Feld about how he structures his day, we decided to ask a number of folks in the Boston startup community a simple question: How do you work? Enjoy the first response in our new series, from Bijan Sabet of Spark Capital. Who else do you want to hear from? Leave suggestions in the comments.

Okay, since you asked, here goes…

First, a disclaimer: I’m not sure I’ve figured it out. I feel like my system is getting better but there are times I feel I’m screwing up the life balancing act.

I travel a ton. I go to NYC every week. At least one day. Many times two days a week. When I’m not in NYC I’m traveling to SF. I get to SF every month. Sometimes twice a month. There were periods over the last 7 years when I went to SF 3 times a month. Those days aged me. I feel like I have a better rhythm now. When I go to NYC I get up at 4:30 am and come home at 10pm. My wife waits up for me usually, which is awesome.

I don’t travel Mondays or Fridays.

On Monday I typically get up at 5:30am. I listen to music to get started and spend 30 minutes scanning Kik and my inbox (which is powered by SaneBox). Then I spend 30 minutes reading and writing. I add new stuff to my Tumblr blog just about daily. At 6:30 am I hit the shower and make the kids breakfast. I get to the office by 8:30 am. I spend half of the day with my partners and the other half meeting companies we are very interested in backing. In between meetings I get caught up on Twitter, Tumblr, and email. There is always music playing on my iMac. On days I don’t travel I work out after the kids go to bed. I haven’t been able to figure out how to work out on the road.

On Tuesday-Thursdays I spend about half of my time meeting new entrepreneurs and half of my time supporting founders that we have backed. Those are the days I’m traveling.

On Fridays I catch up on all the things I’ve dropped during the week. I try to block out Friday afternoons so I have time to think, breathe, and make plans for the following week. The only exception to my Friday rule is the Runkeeper board meeting. I assume Jason holds them on Fridays because he’s trying to torture my friend Bryce who travels from the Bay Area.

from BostInno http://bostinno.com/2012/07/18/how-i-work-bijan-sabet-of-spark-capital/

The Slog Continues

Last week the National Venture Capital Association (where I am on the Executive Committee) and Thomson Reuters announced the 2Q12 fundraising data for venture firms – don’t worry, you are excused if you did not see the results. Not pretty. The data has some potentially troubling implications for entrepreneurs.

While the headline looked encouraging with $5.9BN raised this past quarter, which ironically compares very favorably to many of the recent quarters since the Great Recession started over four years ago, it is the details which are more disturbing. If you annualized last quarter’s pace you might conclude that the VC industry is back to raising around $25BN per year – which is about how much we as an industry invest each year. But as you can see in the chart below, the number of firms which raised capital (38) is very much a low water mark and most of the capital went a very few firms.

Fundraising by Venture Capital Funds
Year/Quarter

Number of Funds

Venture Capital ($M)

2008

212

25,179.1

2009

163

16,335.8

2010

173

13,559.2

2011

182

18,575.1

2012

82

11,173.5

2Q’10

49

2,100.8

3Q’10

56

3,688.4

4Q’10

50

3,735.2

1Q’11

47

7,556.7

2Q’11

45

2,609.4

3Q’11

65

2,140.5

4Q’11

53

6,268.5

1Q’12

49

5,264.4

2Q’12

38

5,909.1

So why am I so disturbed by these results? Couple of high/low lights in the detailed data:

  • Of the 38 firms which successfully raised new funds this past quarter, only five firms (NEA, IVP, Lightspeed, Kleiner, Mithril (Peter Thiel) accounted for nearly 80% of the total dollars raised
  • Of the top five funds raised, four were at least the ninth fund that firm had raised
  • Notwithstanding that NEA is headquartered in Baltimore (with a very significant and successful Silicon Valley presence), the other firms in the top five are based in the Valley – which may raise concerns over time about the geographic diversity of how innovation is funded in this country
  • 10 of the 38 funds were from new managers, which also is the lowest number of new venture managers since 2Q09 – which very much underscores that LP’s have largely turned their collective backs on new venture firms trying to get into the market
  • 14 of the 38 firms raised funds which were less than $10.5MM in size; these firms raised a total of $104MM, which is less than 5% the size of the largest fund raised by NEA ($2.1BN)
  • The median fund size was $11.5MM
  • Many LP’s are concluding that the optimal size venture fund is “a few hundred million dollars” but as funds size shrink, more capital intensive industries like biotech and cleantech will be increasingly out of favor
  • When I stare really hard at the list of funds, many of their names suggest that they are really annex funds or small follow-on investment partnerships of existing funds which arguably overstates the number of new funds raised
  • And what the data does not show is how long these funds took to be raised – that is a real barometer of the health of the VC industry

Having said that, though, the venture industry has a marvelous ability to re-invent itself in the face of poor returns and lack of liquidity, as we are seeing in real time with new creative investment models (micro-VC, super angels, etc). Notwithstanding that observation, the VC industry is characterized by both high barriers to entry and barriers to exit, that is it can be hard to get in and for many firms that have raised multiple funds, most times it is hard to be pushed out!

But what is most disturbing for me is that the concentration of capital in fewer and fewer hands operating with very large venture funds will make it meaningfully more difficult for companies to be funded. And I am not simply referring to raising your first $500k seed round to build your product, which there appears to be no shortage of today, but raising more meaningful dollars to build your company (which still takes real money).

We are in an environment where too many “look-alike” companies have been seeded with quite modest amounts of capital, and when they come back to raise their first institutional round, those entrepreneurs will be surprised by the relative paucity of Series A/B/C VC firms which are actively investing.

So what is a CEO to do? Be hugely capital efficient and get out there now and start meeting as many VC firms as you can.

from BostInno http://bostinno.com/channels/the-slog-continues/