Night before last I went to see the Pinback show with my friend Eric Marcoullier . I almost didnt go. After all, I had just finished eleven straight days of travel, which included meetings in NYC, speaking New Orleans at Tribecon (an amazing experience!), my grandmother’s funeral in San Jose and the Techstars reunion in Seattle. Im glad I went.
The band was fun, the venue, the Ogden Theatre, is always great (sort of a large version of the Fox in Boulder). As the band began to play, Eric and I were about 5 feet or so from the front. Standing against the stage were three girls. Each under 20 (given the black X’es on the back of their hands), dressed as if this was their big night out and bubbly as if the band was the second coming of Jesus.
When Pinback started playing, the girls started to squeal. Loudly. It was quickly accompanied by dancing around and faces full of smiles.
I chuckled to myself watching them bounce around. You see, earlier that day I signed a termsheet for the project Im working on and found a senior technologist to join the team. If I wasnt so tired, I would have been jumping around.
All in all, I couldnt have picked a better place to be than in a place filled with hundreds of people expressing the pure joy I was feeling.
And as the band played, I was screaming like a girl. At least on the inside.
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“I just installed Lijit.”
When people ask me how I came to be working at Lijit, thats the answer I give them. “I just installed the widget.”
From that first outreach from Tara until today, when I publicly announced my resignation from Lijit, that simple answer completely encapsulates what makes Lijit such an amazing place.
We (It will always be a “we”) built a company centered on the concept that transparency, real interactions with our publishers, and building a great product would lead to success. And so far, we have been right.
The numbers are staggering. 1100% increase in publishers since I have been here, a 3000% increase in pageviews and a doubling in our headcount. As we begin to build out the next pieces of functionality, I truly believe that bloggers who have yet to understand the value of Lijit search brings in both feature set and monetization, will finally figure it out and jump on board.
Do I sound proud? I certainly couldnt be prouder of the Lijit team.
So, why did I decide to move on?
Opportunity. Risk. A healthy amount of alcohol. (Ok, really its the first two. I dont drink and after my 5,345 non-alcoholic beer, I realized the futility of that effort.)
I am a startup guy. I love the beginnings of startups. I love watching entrepreneurs jump of the Startup Cliff with the belief that they will figure it out before they, well, splat.
Current Wisdom, my last (and most successful startup) was started in 2003 as a side project. It was sold in 2007. Its time for me to jump again.
So after mentoring a couple of Techstars teams, one began to ask if I would consider to join them as their CEO. “Two kick-ass developers with a kick-ass product?” I thought to myself.
Jump.
It was more of a running leap.
This time is different that Current Wisdom. Before I leapt with Current Wisdom, we were making about $50k a month in revenue. This time, I am actually financing the parachute on the way down. (Anyone out there want to get involved with the project, lemme know. That ground comes up fast!)
But, I am excited. The founders are amazing. The product is seriously bad-ass. And the opportunity? Well, it may not get a Twitter or Facebook valuation in the seed round, but it might get that $1 billion valuation. One day. (No really. It might. And, its not the non-alcoholic beer talking. I think.)
Most importantly, I have the support of my mentors, and Todd Vernon, Lijit’s CEO. “I cant wait to see you as CEO,” Todd said. (Im 99% sure there was no sarcasm in his voice. I think.) The fact that I will continue to be part of the Lijit family also makes the choice easier.
Having that air screaming by my face as we head into uncertainty is the greatest feeling any entrepreneur feels. (Well, except the feeling of putting a really big check in the bank when its all over.)
Am I worried? Nope.
Great team, amazing product and fantastic concept? What else could any startup want? (Money? Right. forgot about that.)
In about 30 days, I will be able to provide more information about the project once we close our round (which, while I joke, is pretty close to being done) and get the product to market…
…and then, its up, up and away!
BTW: Here is the post I wrote when I joined Lijit: Micah Goes Lijit!
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I just walked out of a comic book store for the first time in probably 20 years. It took me 30 minutes to find the place, and once I got there, I felt so out of place.
How could this be? I used to ride my bicycle to the comic book store to add to a comic collection that numbered in the 6,000s. I knew what was coming out when. I knew the people that worked there. I felt like it was a place I belonged.
This comic store was pretty empty. Most of the people in it were older (at least mid-twenties) the only kid there was with his dad. There were more collectibles than I remember, and it was silent. Dead silent. On a Saturday.
Now, one of the companies I helped advise this summer was TakeComics, which is building an “iTunes for comics.” I wanted to know if such a thing mattered.
Disruption is a concept that many professional investors love. Things that shake up an industry can often lead to immense returns — if they are timed correctly. Napster was a disruptor in the music industry, but Apple was the first to really make big money selling digital music.
This summer at Techstars –at least in Boulder–disruption seemed to be a theme.
Theming is an interesting art to managing concepts and more importantly thought processes. At Lijit, we apply a theme to each quarter, and each department adjusts their goals and efforts to match that theme. Foundry Group, a Lijit investor, famously invests in companies that fit within their thematic approach to investment. I can only imagine that pitches to Foundry now begin with: “As a company that clearly fits in your Glue theme…” Notice the focus it brings pitches. Dual win for Foundry.
I have begun to look for the themes within a business to determine its potential, and the potential of the management team. Can the business be boiled down to a single metric (revenue per pageview, for example)? Does the management team think thematically about the problems they are trying to solve for? What is the theme of the company?
Which leads us to Techstars theme. If you look at the ten companies in Boulder, they broken down into two themes: Market Efficiency and Industry Disruptors.
Market Efficiency
Everlater, Rezora, Mailana, SendGrid, Spry and TimZon all were applying efficiency to inefficient markets. Everlator (travel memories); Rezora (email marketing for the real estate industry); Mailana (connection discovery); SendGrid (improved transactional email delivery); Spry (product management); and TimZon (online customer service).
In each case, they have built interesting applications. Will they get funding? Probably. They may find the path a bit more difficult, given that while each solution is unique, because it is an improvement on current offerings, they are not completely defensible against competition. For example, if TimZon proves to be right (that customer service is better over video or audio), what stops players like Get Satisfaction, or other large CRM tools from adding video/audio to their offering?
Disruptors
I love this definition of disruption from wikipedia:
Disruption as a method of execution pulling at all four limbs simultaneously with animals or machines so that the body of the execution victim is pulled apart.
When a company truly disrupts an industry it literally tears it apart. Look at the RIAA‘s reaction to Napster and its ilk. Think about how blogging and other online news sources have effected the newspaper industry.
A true disruptor tears apart an industry with verve and violence in a way that, regardless of the success of the company, changes the industry forever.
This summer, TakeComics, Next Big Sound, Retel and Vanilla are looking to truly disrupt their respective industries.
Next Big Sound are looking to provide band management and artists with two things that are currently unavailable or difficult to gather: performance data and interaction data. Artists, more and more, are becoming businesses, and are learning what business has known for a long time: Data rules.
Companies like Soundscan and others provide artists with data thats predicated on the belief that the greatest effect on a band’s success is the marketing efforts of their labels. What artists like Chamillionaire and companies like iMeem, MySpace Music and TopSpin are showing is that the greatest effect on a band’s success is the ability of the artist to go direct to fan. Next Big Sound is providing access to the data that proves out this disruption in the industry.
After all, dont artists (and businesses) want to know what their fans care about, and where they are interacting with their music (or brands)?
Vanilla and Retel are similar in that they are providing both improved market efficiencies (Vanilla with online community tools and Retel with retail employee management and intelligence), and industry disruptors.
While forums and forum software is often forgotten behind the noise created by Facebook and other similar social networks, there is a large amount of focused community interaction and growth that continues to occur on forums. Companies tend to shy away from building community around themselves because 1) most companies pay community lip service; 2) they dont understand how building a strong community filled with fans can create a long-term customer base that grows organically through word of mouth; 3) they dont know how; 4) they are unaware of the ease of a product like Vanilla.
If companies would leverage their own web presence to build community rather than rely on social media tools, they will be better served in the long term, as most people are fickle about sites like Facebook and Twitter, but not about the brands they love.
Retel is similar to Next Big Sound in that they are providing unique and difficult to obtain data to retail store owners that will allow them to make decisions quickly. With Retel, eventually, retail store owners will be understand where the “hot spots” are within a store, perhaps being able to make determinations on how a store should be laid out to optimize things like cleanliness and worker efficiency.
In an industry where the majority of optimization and efficiency decisions are made by “feel” and “experience,” the level of data provided by Retel will have a transformative, disruptive effect.
There are three major indicators that the comics industry is ripe for disruption: its a $6billion industry (big); increase in non-core revenue–movies versus print (focus shift); lack of cost-efficient alternative to core business (no strong digital replacement for print). You could also argue that the comics industry, other than with manga and anime, have leveraged the internet at all.
TakeComics provides an iTunes-like interface for digital comics (including the digital conversion), as well as social tools for interaction around the titles and characters. In addition, TakeComics also uses the comic books as the “center of the pinwheel” providing access to associated merchandise and content to the title and/or character.
Which brings me back to my comic store experience. All I kept thinking about while I drove around Boulder trying to find the stupid comic store, that I wished there was a digital solution for buying comics. I am no longer a collector, I just want to experience the story and then talk about it with my friends. I also, wanted to know how these current stories intertwined with the stories from my youth. I got none of that from walking into that store.
Disruptive technologies and companies tend to fundamentally change how we view and interact with an industry. Will these companies be able to be agents of change?
They have certainly started from some interesting places…
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