Rice and Beans: An Interview with Brent Frei of Smartsheet

When asked what his “old-age” trait, the trait that exists in you that will intensify with age, will be, Brent Frei responds, “Efficiency.” Aside from his intimidating stature and preceding highly accomplished reputation, Brent is a humble man who is strikingly determined. It is apparent that efficiency is core to who he is and efficiency is the core idea behind his company Smartsheet.

While with his previous company, Onyx, Brent realized a problem with operational oversight. The observed problem extended beyond his company. Products popped up like weeds yearly to help with project management and oversight, yet nothing appeared to stick. According to Brent, many adopted tracking programs stating they were “trying such and such” but all continually returned to the use of spreadsheets. “Spreadsheets are immediately available, they’re perceptually free, they’re perfectly flexible, they don’t force me (the user) into a process and they are easily shared and changed.” Brent realized the limitations with spreadsheets. Spreadsheets are not automated. Reminders to complete tasks do not exist within spreadsheets. You had to use other software to produce documents and manage products. Hence, the birth of Smartsheet.

Brent thought, “why not weld the features of project management programs into a spreadsheet and make them work together.” Others had been continually producing products that “lined up with the definition of insanity: doing the same thing over and over while expecting a different result.” Brent’s idea merged these programs into what consumers already identified as their go to solution.

As seemingly simple as the idea appears, do not be fooled. Execution of the idea to creating a product took several years of development.

To aspiring entrepreneurs, Brent offers up this piece of advice:

“If you’re not super committed and not willing to eat rice and beans for years to get there, don’t bother. You have to be unbelievably determined.”

 Smartsheet is a testimony that Brent practices what he preaches. The first few years of Smartsheet’s existence were spent in development. At year 4, Brent was doing sales and began realizing the product did not work as efficiently as they had hoped. They realized the interface of the product was correct; people loved it when they got it. But that was the thing. They had to ‘get it’. Brent explained there were too many core concepts to learn before usability became simple.

Given the feedback, and under instructions from his wife, Brent and his team had new users test the product while they observed. Brent describes that experience as “humiliating”. Brent and his team validated every complaint heard from users. The users were right. The product needed to operate more efficiently. Given this feedback, taking the product out of beta would guarantee the company a spot with the ‘has beens’, all those before them that launched a solution that was under par of what consumers needed. They had a choice, run it into the ground or redevelop the product. They chose the latter.

They spent 18 more months in product development.

“We were set to run out of money in May. It was December. Our adult product was set to launch in February. We were coming out with Gantt Charts. The launch of Google Ads was approaching and we had invested time into adwords…just one of the 3 had to hit.”

 True to his advice, Brent did whatever he could to secure capital for Smartsheet. With 5 small children, Brent sold his house. He also went to his parents and borrowed $300,000. He undoubtedly believed in his product.

“If I believe in something, it’s not going to fail. I will die before it fails.”

The launch of Google Ads proved successful as well as Gantt Charts and the adult product launch. Soon, the company would not run out of cash in May but in June. Then it extended to July, from July to August and then beyond.

The diminishing capital honed in the focus of Smartsheet. They became incredibly, and noticeably, efficient with the use of capital. They focused in on what mattered and what actually had an impact on the growth of the company. Smartsheet began realizing customer growth of 30-40 new customers a month.

Smartsheet has grown from acquiring 30-40 new customers a month to acquiring 180 new customers a day. Today, they are listed at number 22 on Geekwire, Seattle’s Startup Leaderboard. The success can be attributed to Brent, his team and the relentless support around them. Brent’s determination is truly an inspiration. Congratulations, Brent.

Smartsheet has grown from acquiring 30-40 new customers a month to acquiring 180 new customers a day. Today, they are listed at number 22 on Geekwire, Seattle’s Startup Leaderboard. The success can be attributed to Brent, his team and the relentless support around them. Brent’s determination is truly an inspiration. Congratulations, Brent.

Advertisements

Company Profile: onehub

In perusing the Geekwire 200, I recently noticed a company in the 157 slot that I had not noticed before. Still small, Onehub boasts 664 Twitter followers, 2K Facebook followers, under 50 employees and 1K external links. Compare this to the first entry on the list, BigFish, with twenty times the external links and 150K times the Facebook attraction and it seems like Onehub has a ways to go before they really get noticed. Upon closer inspection though, Onehub has developed an interesting cloud application with a simple proposition of holistic business focused document management that seems to address some significant pain points for many different businesses looking to collaborate seamlessly in the cloud.

 

At the top of its homepage, Onehub boasts “Simple, secure sharing with unlimited storage and sharing for all of your business files. Share, manage, and access from anywhere”. Onehub goes onto say that users can:

 

  • Share files with confidence: Role-based permissions give you easy, granular control over what users have access to in your Workspace
  • Access your content anywhere: Mobile and desktop applications allow you to access, organize, and share your content from multiple devices.
  • Make it your own: Upload your logo and use custom colors to create a truly branded experience.

 

Onehub’s target focus is on businesses who need formalized document sharing and collaboration internally and externally. Through role based permissions, a business manager can set up document sharing for an internal project team to collaborate and edit seamlessly and in real-time using Google Documents editing system. Onehub extends its solution beyond internal walls by giving a business manager the ability to rebrand the customer facing portal using branding uploads and custom coloring. Onehub then overlays secure access on your desktop and mobile using password based permissions and secure links.

 

My initial reaction was that Onehub would be targeted at smaller businesses for internal collaboration and could function as an external document sharing hack with customers for bigger businesses with full-time IT departments. The solution feels like a slightly more sophisticated Dropbox with Google Doc’s word processing features but as I dug deeper, it seems that the company has built deeper security than it would initially convey. As a result, they have attracted larger partners like Aflac, Whole Foods, AARP, and the NHL to their service, providing convincing evidence that even larger firms can utilize the collaboration, storage, and customer facing tools without concern for scaling and security. This is surprising because I would have expected internal IT departments for larger companies to be using tools like Microsoft Sharepoint or internal homegrown collaboration tools but my expectation is that there are certain user focused tools, such as real-time editing, that are lacking in these enterprise focused solutions and drive end users to hack their way towards effectiveness using collaborative but unsecure tools like Google Docs and Dropbox. As a result, some enterprise IT functions might be seeking out secure external solutions like Onehub to build the collaborative tools that their users crave while maximizing their control on security and minimizing their budgetary spend.

 

I suspect Onehub had this all in mind when they designed their initial solution as the concept focus for both small and large companies quickly comes through on their website. What an effective approach for an up and coming firm!

– John Downey

Z Girls Empowers Young Athletes

Z Girls is a program for young female athletes that teaches them the mental and emotional skills they need for their sport and their life. Founded by Libby Ludlow, a former Olympic skier, the Z Girls mission is to “empower girls with confidence, courage, and community.”

The Z Girls program is specifically targeted at 11 to 14 year old girls who participate in sports. According to Libby, this is a prime age to influence girls and incorporate the mental skills that are most important for their personal and sport successes. While there are sport psychologists and sports camps available for girls today, Z Girls has created a new market with its comprehensive instruction for young female athletes that is taught in the context of sport. Z Girls offers sport-specific curriculum in 6 one-hour sessions at a team’s regularly scheduled practice or 4 one-hour sessions with select components of the curriculum, or a one-day summer camp.

Z Girls positions itself as a fun camp with supportive coaching for young female athletes. Core to Z Girls is its Compass Curriculum™ which is based on four key elements: Inspired Direction (Courageous and Purposeful Goal-setting), Resilient Mind (Self-Awareness, Positive Thinking, ad Confidence), Solid Support (Communication and Building a Supportive Community), and Thriving Body (Positive Body-Image and Healthy Nutrition Habits). The curriculum is delivered through the consultant channel – the company recruits and trains Program Leaders who are all collegiate, professional, or Olympic athletes. The Program Leaders are not only instructors, but they also serve as positive role models for the young girls.

It’s always interesting to see how an entrepreneur can take something they are passionate about and turn it into a real business. Libby knew from the very beginning that she wanted to give back to the sports community. After receiving accolades for a pilot program she ran and winning 2nd place in the UW Business Plan Competition earlier this year, Z Girls is just beginning to take off. Thank you, Libby, for being an inspiration to young female athletes and to students who are looking to pursue entrepreneurship.

Not Just a List, but a Book

Quite similar to Craigslist, Angie’s List, Living Social, or CitySearch, Judy’s Book is a mixture of a local business directory with customer reviews and coupons. They call themselves, “The Social Search tool” with 4.5 million reviews, over 11 million place and business listings, and 450,000 members. 68% of their members are women, mostly moms, with 32% having household incomes over $100K and 65% are college graduates.

Given their strong female target market with buying power, Judy’s Book looks to attract small local businesses in major cities including Seattle, San Francisco, Los Angeles, and New York, among others. The goal of this website is to make it easy for consumers to store and share places and recommendations in a social book.

It’s an interesting way to keep track of your favorite local places, but I’m not sure I need yet another online site to reference. It’s already so hard to keep track of these different sites. When I search for a local restaurant, dentist or dry cleaners, I tend to start with Bing or Google, or ask friends on Facebook, but I may just give Judy’s Book a try, too.

Clare Media Group, something special from humble roots

Clare Media Group Started over 10 years ago as the dream of a 16 year old high school student. After being inspired by a high school teacher, Joel Clare knew he wanted to do graphic design, photography, and audio/video production for the rest of his life. The first hurdle was convincing his parents that not going to college was a good idea. This was easily fixed when he was in the right place at the right time and quickly acquired two paying customers. This snowballed into landing a big contract with the local library to produce some bi-lingual videos to teach Spanish and English.

Joel has never wanted to bite off more then he can chew. His motto of “Seek organic growth and operate with integrity” has served him well. Over the last 4 or 5 years he has landed contracts with large companies like Amazon and Subaru. Joel also believes in surrounding himself with people who are smarter then himself; which sometimes means he works for free just so he can learn a new skill.

In this context I will call working for free a marketing tactic because it has helped him develop solid relationships with other people in the industry. Some of these relationships are helping land him work even years later. In an industry like the digital arts, everything is a commodity.  Joel’s attitude and the excellent quality of his services are what keeps his customers coming back to him. Above all it is the relationships that Joel has created that allow him to do what he loves.

If you have time, check out his work (claremediagroup.com) and consider starting a relationship with a humble, capable, and creative; graphic designer, video producer, commercial producer, and live event production specialist.

 

Neil Crist and the Founding of Venuelabs

Prior to November of 2011, Venuelabs as it is today did not exist. Instead, Neil Crist was leading the company, then called Valuevine, which provided businesses a software platform to easily push and schedule marketing promotions on multiple social media channels.

Prior to founding Venuelabs, Crist spent 3 years as the head of product management at Jobster, one of the first companies to leverage Facebook and social networks for businesses. This was Crist’s first foray into social media. After leaving Jobster to start his own consulting firm, he helped friends market their local businesses and began to see a common theme emerge. For each of his friends’ businesses, they were trying to manage multiple social media channels for marketing promotions. What if he could provide a software service that made this easier for companies?

And so in 2008, Crist decided to start Valuevine with his co-founders. One of their earliest customers, Emerald City Smoothie, had several franchise locations, each with its own social media presence. The leader of the company, who lived in Seattle, wished he had the ability to manage the social media presence of all locations from a central hub. This helped spark the decision to target franchise-type retail stores that had 20+ locations. Crist and team found that there were over 60,000 businesses in the US that fit the bill. To minimize customer acquisition costs, Valuevine decided to do all sales calls over the phone and Internet, and to not invest in a field sales team. The inside sales team called on all prospects to qualify leads, then flipped them over to account managers who would follow up with calls and demos over virtual meetings. Deals large and small were all closed from their office in Bellevue.

The company was doing a good job acquiring new customers, but one need that consistently popped up in customer feedback was the need to measure and understand the ROI from social media promotions. Valuevine offered a service to push out promotions, but did not have a tool to measure the qualitative impact of these promotions. And so in September of 2011, Crist and team decided to pivot the product and reinvent itself as a location-based analytics platform. A month later, the name Valuevine disappeared as the company re-entered the market as Venuelabs. Armed with a new name that represented the innovation coming out of the company (as well as the company offices, which are located in a former bio-tech office lab), Crist and team spent the next 11 months creating a new software service to better fit the needs of the marketplace.

Although the product changed, the target market and sales process remained the same. As the sales team refined its pitch, and prospects began to understand the importance of by-location social media monitoring, the company’s sales began to take off. It now counts Chevron, McDonald’s, and Mercedes-Benz amongst its customers. With a great base of customers and a growing team, keep an eye on Venuelabs as they move offices to the SODO neighborhood, and continue to scale to meet customer needs.

Bag Borrow or Steal — To Rent or To Buy?

There comes a time in a woman’s life where she has to ask herself, “What handbag goes with this outfit?”

She’ll fling through her collection of purses, clutches, and handbags, searching for the perfect one to go with her fancy dress. After exhausting her collection, she searches through her friend’s, her sister’s, and her mom’s collections, yet still comes out empty-handed. So onwards to the mall, where alas, she finds THE perfect handbag to go with her outfit – the Louis Vuitton Monogram Canvas Ellipse Petit Modele Handbag – only $1,150…

LV Bag

$1,150 for a handbag she’ll only use a couple times (after all it only goes with this one dress)? If only she could borrow it for this one event. Solution: Bag Borrow or Steal, a Seattle, WA company that allows consumers to rent handbags, jewelry, and other accessories.

Several startups have been tackling the “sharing economy” with services that allow you to rent out rooms, share your car, or even rent a power tool. Typically, these services allow users to connect with one another to share things, but Bag Borrow or Steal actually holds its own inventory to rent out.

Let’s take a look at the handbag mentioned above. If you follow this link, you’ll see that the bag is listed at $1,150 for retail, while the rental of the bag is $150 per month. This means a consumer could rent the bag about 8 times before exceeding the list price. For the woman who only needs the purse for that one special occasion, and MUST have that specific purse, it makes sense to just rent it for the month.

However, $150 for one night of use is expensive. It looks like the company used to offer weekly rentals, but has eliminated that option (potentially because of shipping and inventory management costs). It’d be interesting to see if the number of renters dropped when that option was eliminated. Not knowing prior pricing options, I would recommend a 2 week rental that is priced higher than half the monthly rate. For example, for the bag that costs $150 per month, price the 2-week rental at $90. If the company really wants to drive consumers to the monthly option, it could price the 2-week rental closer to the monthly rate. However, having this lower price point may attract those users who didn’t see the value in the monthly rental.

Bag Borrow or Steal has been around for about 9 years now. Coming out of the recent recession, it’d be interesting to see if consumers have withheld spending on luxury items like handbags. And if they have, would rental be an alternative to owning, or would consumers not even consider renting? It’d also be interesting to see if the company has considered a peer-to-peer option, allowing owners to rent out their personal items. If anything, it appears the company has a good base of customers that will continue to grow as more and more people become comfortable with sharing with strangers.

General BioDiesel

Image

 

General Biodiesel, Seattle based company, is currently trying to solve one of the most important US energy issues. US is presently importing over 60% of petroleum from overseas as well as US consumes 25% of the world’s supply while making up only 4% of the world’s population- staggering statistics.  As developing nations like China , India, and Brazil become more influential in energy’s world market, our national wealth and security depend on our ability to adapt and produce alternative fuels right here at home, which is the main mission of General Biodiesel.  They are working diligently in the production of high quality biodiesel fuel from sustainable sources (e.g., recycled cooking oil and other sustainable feedstocks) while providing strong returns to stakeholders, taking care of our customers and employees, and contributing to local economies.

Presently, General Bio is proving their products multiple locations in the west coast (CA and WA) due to their partnership and distribution with Propel. Propel is building stations that offer true alternatives to conventional petroleum, providing a selection of high-performance, premium-quality, renewable fuels at their locations. These fuel stations support Propel’s vision of clean energy for the automobile industry as well the mission of General Biodiesel.

Based on Clean Cities Alternative Fuel Price Report -2012, which is a quarterly report on the average prices and regional price trends of alternative fuels in the U.S. This document reports that the nationwide average price (all amounts are per gallon) for biodiesel (B20) has increased 35 cents from $3.83 to $4.18- these amount does not present the price of distribution for General Biodiesel. Compare to regular diesel fuel which is ~ $3.90; giving a vast disadvantaged to this eco-friendly fuel source. The prices collected, at-the-pump sales prices for each fuel, including Federal, and state motor fuel taxes. 

Positioning Analysis

Image

Antibody therapy is an innovative technique that uses engineered antibodies to specifically bind to target cells or proteins, which then stimulate the patient’s immune system to attack those unhealthy sections of their bodies. This complicated biosynthesis of modified antibodies will eventually improve clinical outcomes for patients with cancer and other inflammatory diseases. Currently, the production of these synthetic antibodies is possible in almost any extracellular/cell surface target. The potential manufacturing of this promising molecular therapy and the high success to fight common illness projected this technology to be a $30 billion dollars market. Making the production of these synthetic antibodies highly demanding for biopharmaceutical companies like ImmunoGen, Inc., Seattle Genetics, Inc., Affimed Therapeutics and many more. 

Alder biopharmaceutical, a Bothell startup based company, has recognized this potential market for antibodies therapeutics and decided to work on a simpler, efficient, and profitable pathway to synthesized this product. Alders’ antibodies production is based on a method that incorporates yeast cells rather than animal cells, which is faster for manufacturing, lowering cost, reducing risk, as well as a groundbreaking approach. “Alder’s technologies allow companies to take control of antibodies manufacturing and timelines”-company’s website. At the same time, Alder is currently creating diverse set of products that have expertise in clinical autoimmune applications and inflammatory disorders. One of the most recent product is ALD518, a neutralizing monoclonal antibody for pro-inflammatory cytokine, which has completed FDA Phase I clinical trials- giving Alder a step forward into this market. 

Concerning marketing positioning, Alder Biopharmaceuticals has separated itself from its competitors and other companies by focusing and offering the molecular synthesis that incorporate yeast as a host cell. As it was stated previously, this technique allows pharmaceutical and clinical companies to decrease their antibody-manufacturing time frame as well as production price. Although, Alder is in their nascent stages as a company, they have identified their strengths and promoted its technology edge to give them space to growth in this multibillion dollars’ market. According to Nature’s recent article, antibodies have emerged as an important new drug class: “Indeed, 18 antibodies are now approved (17 have been marketed, and 1 withdrawn) for therapeutic use in the United States across diverse clinical settings, including oncology, chronic inflammatory diseases, transplantation, infectious diseases and cardiovascular medicine”. Making these synthetic products, engineered antibodies, constitute the most rapidly growing class of human therapeutics and the second largest class of drugs after vaccines. Clearly, Alder will benefit tremendously from clinical applications and therapeutic of antibodies, which allow them to grow and expand. Over all, Alder is promoting their reliable and cost efficient technology that provide value at the highest level. 

Presage Biosciences

In order for a Pharmaceutical company to go from the discovery of an active drug molecule to a brand name on the shelf, they must first put the drug through multiple stages of clinical trials. Moreover, each stage of clinical trials can cost an order of magnitude more money that the previous stage. That is to say, it can cost a pharmaceutical company hundreds of millions of dollars just to pass clinical trials and become FDA approved. What is more, only a small fraction of drugs that begin the clinical trial stage actually make it through all the stages. As you can imagine, if a pharmaceutical company could predict which drugs have a greatly likelihood of passing clinical trials, they could potentially save lots of time and hundreds of millions of dollars. This is where Presage Biosciences steps in.

Presage Biosciences, a local Seattle startup that is a spinoff of the Fred Hutchinson Cancer Research Center, specializes in testing combinations of drugs in vivo to better predict their efficacy. Having spun out of Dr. Jim Olsen’s lab at the Hutch, Presage specifically focuses on predicting the efficacy of cancer drugs. They do so by using the Presage platform, a technology that allows Presage to inject combinations of cancer drugs with high spatial resolution at multiple sites within a single tumor. Presage’s world-class researchers then subsequently apply their analysis of the tumor to determine the efficacy of the drug. Big Pharma can then decide whether or not to invest large sums of money to go to clinical trials. As Dr. Olsen states in an interview by Luke Timmerman on xconomy.com,

We can help halt inefficient programs at the early stages before Big Pharma companies put millions of dollars into programs that are going to fail. We can help weed out the winners from the losers early on.

Being a relatively new startup, Presage has already started to garner success. The company with around 20 employees has recently secured millions in Angel investing and has been tapped by other biopharmaceutical companies to use their preclinical testing platform. Presage has targeted a very specific market: large pharmaceutical companies that have developed a cancer drug that is at the pre-clinical trial stage. Being a B2B business, their marketing strategy is a little different than for a B2C strategy. However, they do have a LinkedIn profile as well as a being the number 1 search result when “presage” is queried in Google.

Foodista

Foodista is an online encyclopedia of recipes, foods, tools and techniques as well as a location for food lovers to receive a daily digest regarding food related news.  Foodista was created by three former Amazon employees looking to create a collaborative, intuitive, and user friendly experience for people seeking trusted recipes. Foodista is currently ranked 197 of 200 on the Geekwire top 200 list and was launched on December 2008. The site allows users to create an account and then load their own recipes on the site, photos (from flickr), or browse existing recipe and tips. Recipes that are submitted can be edited by either the person who submitted the recipe or the staff at Foodista.  Each recipe has links that can be clicked to give more detail on the technique or ingredient. In addition to their website, Foodista  organized the first International Food Blogger Conference (IFBC) in 2009 and released a cookbook Foodista Best of Food Blogs Cookbook in 2010.

According to their website, Foodista’s target market is” food lovers who want to share and exchange its collective knowledge about all things culinary.”  Foodista could also target people who want to cook at home but get confused on the right technique or a specific ingredient, and can use this site as an one stop resource to save them time from searching online for each unfamiliar technique and ingredient.  Foodista also targets food bloggers, food blogs can be nominated to be featured as food blog or wine blog of the day, and there is a blogging section that features recipes from top food blogs.  The IFBC offers a special rate to incentivize food bloggers to attend and review this great event.

Foodista uses their website to share information and seek content. They also use flickr to acquire pictures for the recipes. Foodista reaches their target market through their website, twitter, pinterest, facebook, and google plus accounts.

Venuelabs – Engage Your Local Customers

If you were an executive at McDonald’s, how would you go about managing the customer experience at your 34,000+ restaurant locations? The same goes for Subway, which has 37,000+ locations? Or Hilton, a hotel chain with over 3,900 locations?

For these three companies, experience with the brand is of the utmost importance. Traditionally, if customers had a complaint, they may write a letter to the company, call customer service, or maybe bad-mouth the brand to their friends. For the most part, it wasn’t a problem – after all, their circle of friends couldn’t be THAT big right? But with the creation of social networks like Facebook and Twitter, and user-generated review sites like Yelp, the voice of an individual can now reach thousands, if not millions of people. This is where Venuelabs steps in.

Based in Bellevue, Washington, Venuelabs’ software allows companies to monitor social media channels to discover comments, complaints, or praise that customers post about a company and its retail locations. Venuelabs competes in a hot sector where well-known companies like Salesforce.com, Oracle, and SAP have recently acquired startups that specialize in social media marketing and listening tools. However, Venuelabs stands out by combining geolocation information (i.e. foursquare or Facebook check-ins) with social media listening tools. This allows B2C companies to not only discover customer posts about the brand, but also the specific retail locations customers are referring to. So if you’re the manager at a local retail store, you can now engage that customer who complained about your store on Twitter or Yelp (or other social media channels), and hopefully fix his/her relationship with your brand. On the flip side, you can also reward your loyal customers who praise your brand on social media.

Currently, Venuelabs is targeting their software solutions at CMOs. Brand management typically falls into the marketing organization, so this is a reasonable segment to target. It’s also a lucrative segment to target. According to Gartner analyst Laura McLellan, by 2017, the CMO will spend more on IT than the CIO. With the advances in online technology and increasing demand for ROI metrics for marketing spend, Venuelabs has targeted a great market for growth. Another key segment Venuelabs can target is the customer service organization within companies. The customer experience for B2C companies has become increasingly important, and is a key aspect in which companies can differentiate themselves from the competition. That’s why more and more companies have created the role of Chief Customer Officer. Customer service is no longer limited to e-mail or 1-800 numbers. Companies MUST, at a minimum, listen to their customers across all media channels, including social media services.

For an example of a company leveraging its work force to engage customers over Twitter, check out the Best Buy story. Also, take a peak at this neat infographic about how customers use social media in shopping decisions.

You Think Marketing for a Startup is No Different?? You’re wrong!!

3 months, several panels, lectures and team meetings and I am only just realizing how different marketing for a startup is than for a large company. You have scarce resources in a startup and every dollar you spend on marketing better not be wasted or its lights out, doors shut. So how is startup marketing different? First off you’re using different channels and you’re hoping to engage your customers more. Twitter and other social media are cheap forms of communication methods that have proven to be effective for startups. Marketing efforts for a startup need to be simple, decipherable and give rise to action. Followerwonk is something new that I was introduced too and is a great tool for startups looking to beef up their twitter presence.

We got introduced to Rand Fishkin and SEOmoz this quarter and I am a huge fan of him of his company. SEO is an important factor for startups and the honesty and transparency that SEOmoz operates with is refreshing. I’ve started to read their blogs and will continue to do so. All the topics on their blog are relevant and applicable to anybody with entrepreneurial aspirations. Keep up the good work SEOmoz!

Do Dreambox have a winning strategy in the long run?

During the past five to seven years we have seen the market for e-learning grow massively. And with good reason. E-learning is a brilliant concept and fits perfectly with the internet generation. This generation is used to finding information on the Internet and expect personalized content on demand no matter the time of day, week, or month. On top of that social media such as Twitter and Facebook have taught this generation to expect instant feedback, as well as how to socialize digitally.

The e-learning offerings are many. The arrival of Youtube led to online education resources such as Khan Academy, iTunes University provides lectures from prominent institutions such as Stanford, Harvard, and MIT, at no cost, and recently Coursera did the same. Today, anyone that has access to the Internet regardless of background, location, and income is able to access top quality education, for free. However, many of the popular e-learning offerings, such as iTunes University and Coursera are mainly targeting college students.

One Seattle startup, Dreambox, have decided to employ a different strategy. Instead of targeting and marketing to students who will leave the educational system within the next five years, they have decided to focus on building an e-learning product for children in kindergarten through fifth grade and selling it to the school instead of the individual. Here is why this focused strategy is brilliant:

Firstly, spendings on e-learning for the U.S. K12 segment is expected to grow 16.8% annually through 2015 and reach $4.9 billion in 2015  making this e-learning segment the fastest growing in the U.S (Thejournal.com, 2011).

Secondly, by focusing on providing e-learning to pupils in their early years the company can grow and develop new offerings as the user base gets older.

Thirdly, once Dreambox have gained a foothold at a school, there will be a switching cost for both the user and the school, making it more difficult for competition to enter the territory. Notice that this would not be achieved to the same degree if they targeted the individual.

Finally, Dreambox provide a service that helps teachers and schools monitor development of the individual child, which essentially is what allow Dreambox to charge money for their service instead of providing it for free.

Instead of being everything to everyone, Dreambox’s narrow focus allow them to become the best at what they do and grow at a speed that does not drain the company for resources. This makes a lot of sense for a startup, but what happens when it grows, will this narrow focus be enough?  Do Dreambox have a winning strategy in the long run? Or what should be Dreambox’s next strategic move?

Content Is King: Nuubuu’s New Content Distribution Platform

Within the explosion of the Internet and digital distribution over the past 20 years, content production and distribution has been growing exponentially.  In a number of creative areas, from music, books, film, and art, the traditional, physical model of distribution has been disrupted, making the overall access and supply to creative content much larger and easier to obtain.  Former startups from Ebay to Etsy are now among the powerhouses in the online retail marketplace, and Amazon has become one of the premier resellers of all types of content, both physical and digital.

There are countless content distributors on the internet, although most tend to focus on a particular vertical.  For example, in stock photos, Getty Images is the industry leader.  In music, there are a number of services that offer different avenues of distribution options, from Spotify’s subscription service model, to Pandora’s custom radio option, to the now “traditional” digital download model from Apple’s iTunes or AmazonMP3, although there are outlets such as CdBaby.com and Tunecore for self distribution platforms.  The eBook market has been traditionally dominated by Amazon, although there are a number of startup sites such as Lulu.com that focus on self publishing.  Traditionally, these content providing startups have been focused on one particular vertical, trying to gain traction in one creative vertical, before debating expansion to another marketplace vertical.

This is why a new Seattle based upstart called Nuubuu is so intriguing.  They have a barebones, simple layout for distributing almost any creative work digitally. Additionally, they provide a creator setting pricing mechanism to allow the creator to set the work anywhere between $1 and $1000.   This means that an individual song can be offered for $1, a digital textbook can be offered for $300, while high resolution digital artwork can be offered for $1000 (or vice versa).  There is an additional social aspect to the product offering, which allows for the creator to post the store’s outlet via Facebook, Twitter or to blogs.  This way in theory, you would be able to generate traction from the distribution of content, thus increasing the possibility of more sales and marketing of your product.

One interesting aspect to the startup is that for a content distribution company, NuuBuu appears to be outwardly absent of content.  On almost all other content distribution sites I’ve encountered, the products distributed are also displayed on either a home page or larger store page.  While NuuBuu is merely 4 months old, and has only recently launched publicly, at the moment, there is no function to see who else is selling something on or through their site, and it takes multiple clicks to upload your own content.  Therefore, while NuuBuu is acting a facilitator towards content sales, it appears that they do little to promote content sales besides providing a social element to share potential customer growth.  While the concept of a multi-vertical distributor is promising, I will be interested to see the ongoing evolution of NuuBuu and it’s customer traction and engagement in the future.

Amazon’s Acquisition of Seattle’s own TeachStreet not just for Talent

TeachStreet is an online service and marketplace for matching students with teachers around various activities, from yoga to language lessons as well as providing tools and lesson plans to teachers. The service featured more than 150,000 classes in Seattle, San Francisco, Chicago, Denver, New York, Philadelphia and Portland.

On February 2nd, it was announced that Amazon would be acquiring the five year old startup for an undisclosed sum, shutting down the service and integrating the team into the AmazonLocal division, which provides daily deal service in more than 40 US cities. Amazon most likely acquired the company as more of a talent acquisition given its announcement to shutter service on February 15th, less than two weeks after the acquisition. However, the underlying platform technology is valuable as it provides a critical, missing component for AmazonLocal’s service: helping customers find local experts, such as career counseling, kitchen remodeling or car purchase negotiations. This same technology is also being used by The Washington Post for its Service Alley leads service. This technology and expertise of the TeachStreet team will provide Amazon a new capability to rapidly make its local services more relevant to consumers.

TeachStreet’s founder, Dave Schappell, previously worked for Amazon as a director of product development and the startup had raised over $3 million from Madrona Venture Group, Hulu CEO Jason Kilar and others including Amazon’s own CEO Jeff Bezo through his Bezos Expeditions fund. It is clear the Amazon connection played a role in the acquisition as the startup had been seeking a buyer since last February, when Google altered its ranking algorithm, resulting in a devastating impact to TeachStreet’s traffic volume. The company never fully recovered and while trying to seeking partnering opportunities to boost traffic, found that companies were more interested in acquiring the company outright.

Interesting to note as well is Schappell is a very active member in the Seattle startup community, as he hosted a weekly Hops & Chops Thursday happy hour on Capitol Hill.

You can expect to see AmazonLocal begin offering classified ad types of services for local experts combined with powerful search capabilities and vendor tools enabling providers to easily promote their service and offer deals or specials on the AmazonLocal platform and through its affiliates, thereby helping service providers to extend their reach and marketing capabilities. These additional services will give AmazonLocal a boost as it seeks to expand its capabilities and differentiate itself in the highly competitive daily deals space.