David Hauser

Survival of the Fittest: Using Evolution to Your Advantage

Tue, 10 Sep 2019 10:00:07 -0700

The following is adapted from my new book, Unstoppable.

With each passing season, your life unfolds. The sun rises and sets, and with each new day, you have the ability to align yourself with that flow, or not. The more time I’ve spent researching this part of our evolutionary history, the more it’s become clear to me how important adhering to these flows can be for optimal health and wellness. Our ancestors used seasons and other natural phenomena as a guide for eating, living, and a means of survival.

Today, life is very different. Food is no longer scarce in many parts of the world. Fruit is sourced and distributed globally, and available in temperature-controlled grocery stores 365 days a year. This is a completely different experience from that of our ancestors.

All that convenience and abundance is appealing, so it’s no surprise that most of us don’t want to make a massive departure from modern life. Even so, there are still lessons that we can learn from our evolutionary past to make our lives today richer and healthier.

Gorging

In the book Sapiens by Yuval Noah Harari, the author calls our attention to something he refers to as “the gorging gene,” which is the idea that humans are designed to gorge on food for the sake of survival. For example, when our ancestors saw ripe fruit, they quickly ate it because nature was telling them to do so. Their consumption of food was entirely based on their relationship with the earth and the passing of the seasons. Fruit was ripe for only a limited amount of time, so they took advantage of it. Not doing so would be a waste of a valuable resource.

Given the relatively short period of time that’s elapsed between our ancestral way of life and today, it makes sense that our bodies haven’t quite been able to get rid of this so-called gorging gene. When we see food in front of us, we want to eat it—sometimes even when we’re not hungry at all. And therein lies the problem: saddled with an evolutionary imperative to eat what’s before us, we do exactly that. With access to all types of food, all the time, our bodies tell us to feast as if winter is coming. But it never does.

To make the most of this gorging gene, identify and test the high-quality whole foods that would’ve sustained our ancestors long ago. For example, as evidenced by multiple books on ancestral eating patterns, carbohydrates certainly weren’t available for consumption. That meant that fat was the fuel of choice. Today, we can find healthy forms of fat just about anywhere, including nuts, cheese, and eggs.

But beware of abundance. You can purchase macadamia nuts year-round, but you can also, for the first time, order any salty, greasy restaurant food within a couple of minutes through an app on your phone. Food scientists have figured out exactly how much sugar, vegetable oils, and other ingredients combine to make something that our biology responds to. It’s all a trick, and they know it, and they’re using it against you. Use science, research, and rigorous lines of questioning—and experimentation—to your advantage.

Fasting

Although there are still hunter-gatherer societies in remote parts of the world, chances are high that you’re not living in one. Instead, like me, you live in a world where a famine is unlikely to occur anytime soon. And that means you’ve got to negotiate making the right food choices in the midst of a dizzying array of options, all while struggling with an evolutionary imperative to eat. It’s essentially a recipe for disaster.

Since our bodies are used to a feast-and-famine flow—the cycle of different foods growing from the earth, the lack of food during the winter, or periods when it was impossible to forage or hunt—it’s important to take a clue from our ancestors and apply a similar approach in our modern lives.

Evolutionarily speaking, it’s worth exploring whether we feel better and operate better when gorging certain natural foods, cycling those foods in and out of our diet, and then periodically fasting. Of course, this doesn’t mean that these ideas will produce 100 percent optimization for your nutrition, since each person evolves differently, but it does mean that all of these ideas are worth trying because they’re rooted in our past.

Cycling can help you force your body into natural feast-and-famine cycles through things like fasting and calorie reduction. When you fast, it depletes liver glycogen (a stored carbohydrate), shifting the body into a state of ketosis. In this state, ketone bodies (produced from fat) are used in the place of glucose for most energy needs, but in particular by the brain.

Your brain can shift nearly two-thirds of its normal glucose dependent metabolism to one fueled by ketones, which provide a much more stable energy source. In other words, ketosis is a natural energy-release mechanism in our body, and by thinking about your nutritional cycles this way, it is possible to put abundance to your advantage.

Sleeping

In addition to using evolution to inform experimentation around diet, I urge you to use it as a guide for other aspects of daily life, such as sleep and exercise. For example, history tells us that our ancestors went to sleep around sunset and got up around sunrise. Interestingly, many scientific studies have indicated that the most restorative sleep is between 9:00 p.m. and 1:00 a.m., which doesn’t shift if you get to bed later—you can’t make it up. If you don’t sleep during those times, the benefits are just lost. We also know that nine hours or more of sleep is healthiest for humans, which all goes back to our history and how we’ve been programmed to survive.

Looking Backward to Move Us Forward

By understanding how our ancestors lived, and what biological processes were key to their health and survival—gorging, fasting, sleeping—you can pursue similar activities, but with greater access to modern resources. Humans are great at moving forward, adept at looking into the future, creating new things, and putting ideas into motion.

But when you look at diet, nutrition, and wellness, it would be beneficial for us to look backward in time to see how we evolved. By analyzing the major events in evolutionary history, we can learn a lot about some of the difficulties we face today. Taking lessons from the distant past doesn’t mean that we have to live crudely; it just means cultivating the knowledge that our biology and history have the power to provide answers to current problems.

For more advice on bringing evolution into the present, you can order Unstoppable on Amazon.

Why I Moved Back to Vegas after Six Months in Austin

Wed, 26 Jun 2019 14:11:04 -0700

Las Vegas gets a bad rap. Known nearly exclusively for casinos and big celebrity performances on the strip (along with other stripping activities), it’s easy to assume that outside the strip, nothing is happening in Vegas. But the truth is, there’s a world of hidden gems in Vegas, which I personally discovered when I decided to move there from the east coast nearly a decade ago.

After seven years in Vegas, I decided to give Austin a try. Since I’d had an office for Grasshopper there for a few years, I was well aware of the many reasons it’s an awesome place to live – live music all the time, professional opportunity, a lake smack in the middle of town, a booming economy, great schools for the kids, and a general vibe of awesomeness. I just had to check it out.

But what I found out over the subsequent six months was that I’d been under appreciating Las Vegas. Austin’s great, but there’s a definite disparity between the hype and the reality. And honestly, Las Vegas has the opposite problem. I feel like it’s incredibly under-hyped. Six months into my Texas adventure, I picked up my family and moved back to Vegas, and I have zero regrets about it. Here’s why.

Cost of Living

Austin is the second most expensive city in Texas (second only to Galveston, a popular vacation spot filled with lux beachfront property). Outsized housing cost, whether you’re renting or buying, is a big reason for the price tag. Due to strict zoning restrictions and a fast-growing population, there’s not enough housing to go around, resulting in higher median home prices than the other metro areas of Texas. In Austin, the median home price is $360k, but in the nicer areas on the outskirts (West Lake, Lakeway) or the more historical neighborhoods in the interior of the city (Hyde Park, South Congress), the range gets much higher – $800k and up into the multiple millions.

Compare these numbers to Vegas, where the average home costs $280k, and you can get a beautiful four bedroom spot in some of the best neighborhoods in town for under $400k. A pretty stark comparison to Austin, especially if you have a couple of kids and need a little more space.

Housing is only one factor in cost of living. Other factors are food costs (groceries and dining out), healthcare, household services, and transportation. According to data from BestPlaces, both Vegas and Austin rank lower than the national average for grocery prices and notably higher than average for transportation. When it comes to healthcare, Austin ranks significantly higher than the national average, while Vegas is lower. Styles of state governance might have something to do with that discrepancy. I also found many household services in Austin were more expensive, from landscaping to cleaning.

Quality of Life

Cost of living surely has a direct impact on quality of life – if you can stretch your dollar further, chances are you will end up with a few more creature comforts. For me, that’s super important, but the environment I’m in has a huge impact on my quality of life too. So does how easily I can get from place to place. Fun things for my kids to do, traffic, proximity to great food and night life, and just general life amenities are all big quality of life factors for me as well. And honestly, Vegas checks pretty much every box better than Austin does.

The Great Outdoors

Austin is known for its beautiful natural places. Barton Springs and Town Lake run right through the center of the city, and a short drive takes you to beautiful hill country destinations, including state parks with larger bodies of water and endless hiking and biking. There’s also a rapidly expanding wine country just outside the city limits and into the hill country.

But truthfully, it’s so hot and humid in Austin and the surrounding areas that it can be demotivating to get outside and enjoy it. Furthermore, for the first time in my life, I developed allergies living in Austin. My kids didn’t fare so well either, which made hanging out in the great outdoors a bit of a disaster. Las Vegas has a much drier desert climate and a lot fewer allergens floating through the air. Plus, there are real mountains. Texas Hill Country is gorgeous, but it doesn’t really compare to the mountains of the Mojave Desert or the sandstone towers in Red Rock Canyon.

If you’ve only ever visited Vegas to hit the casinos or see a show on the strip, you might not realize the plethora of outdoor opportunities at your fingertips. Red Rock Canyon, a National Conservation Area, will give you some of the most amazing views you’ve ever seen. You’ll hike among glorious red sand stone rock formations, possibly run into some desert wildlife, and can even camp in certain areas. If you’re a rock climber – especially a sport climber – and haven’t visited Red Rock, be sure to add it to your bucket list.

Lake Mead is another major outdoors destination in Las Vegas. It’s a National Recreation Area perfect for boating, hiking, biking, fishing, and camping. Take a boat into crystal clear water and make your way through the gorgeous rock formations that line the lake. And if you’re not much of a camper, there are lodging options that still give you direct access the natural wonder of the area. The nearest city, Boulder City, is the home of the Hoover Damn and offers a ton of hiking and biking trails, in addition to two beautiful municipal golf courses.

Other great outdoor destinations include Mt. Charleston Regional Recreation Area (Mojave Desert mountains) and Havasau Falls and Creek (a tributary of the Grand Canyon!). The City of Henderson is just over fifteen miles from Vegas and jam-packed with parks and trails for hiking and sight seeing. It offers sixty-five well-maintained parks featuring open grass lands, playgrounds, skate parks, dog parks, lighted sporting areas, and more.

Traffic and Travel

If you’ve ever lived in or visited Austin, feel free to skip this section. You already know that very few cities rival the hectic gridlock of Austin’s rush hour. The problem is that Austin was never meant to be a big city of almost a million people. It has the infrastructure of a college town and has exploded into a major destination without the ability to expand one of its major thoroughfares, interstate 35. And that’s without the visitors for Austin City Limits or South by Southwest flooding the streets. Bring all those people in and you’re not going anywhere unless you leave after 10am, before 4pm, or well after 6pm.

Las Vegas is just the opposite. It’s a city built for massive tourism but maintains a relatively low local population (roughly 620k). When combined with neighboring Henderson, it ends up being roughly 1M. Most tourists don’t venture too far off the strip, so day to day life in Vegas is pretty traffic-free. Furthermore, because so many people fly in and out, McCarran International is a major airport that flies direct almost anywhere. Compare that to Austin-Bergstrom, a relatively tiny spot that usually sends connections through Houston, Dallas or San Antonio. Two wins for Vegas in the way of traffic and travel.

For the Kids

Admittedly, there’s a major problem with public schools in Las Vegas, and Nevada in general. For the most part, Austin has an awesome reputation for both public and private school education, due, at least partially, to a higher real estate tax. The state of Nevada is ranked 50th out of 52 states in education – not good. It was a big reason I moved to Austin in the first place. There’s just less money for public schools in Nevada than in many other states because it has both a low property tax (.77%) and no state income tax to go towards education. While Texas also has no income tax, property tax is more than double Nevada’s (1.86%).

The reality of poor public schools was a major setback for me until I discovered the private and montessori options. You have to do a little digging, but if you’re willing to do the work, you’ll find that in the end, your kids have great academic opportunities in Vegas, and they’re all pretty easy to get to, regardless of where in the city you live.

For fun with kids though, Vegas wins again and again. I mentioned the overwhelming natural beauty of the surrounding areas, but there’s a lot to do right in the heart of the city as well. The strip might not be the first place you’d think to bring your kids, but there’s the Adventuredome Theme Park, the Bellagio Conservatory and Botanical Gardens, the Shark Reef Aquarium at Mandalay Bay, and the Marvel Avengers S.T.A.T.I.O.N all right there, just to name a few. Not to mention, with the sheer volume of national music and performance acts coming through Las Vegas, chances are, a performer your kids like will be visiting at some point.

Off the strip, there’s endless fun for the kids as well. Here’s a quick list as a point of reference:

Cowabunga Bay Water Park
Discovery Museum
Smith Center (performing arts)
Trampoline parks
Ziplining downtown and Boulder City
Springs Preserve
Downtown Container Park (great food and company)
Pinball Hall of Fame
Ethel M Chocolate Factory
West Wind Drive in Movie Theater
Mountain’s Edge Exploration Park
Lion Habitat Ranch
First Friday in the Arts District

Food and Entertainment

Although Austin isn’t known for it’s food scene, that’s slowly changed in recent years. New creatives are coming in to spice up what has historically been a somewhat “meh” dining culture. Cool, creative fusion restaurants like Loro and Elizabeth Street Cafe are popping up all over the city and gradually elevating the food scene, which I definitely appreciate. That being said though, the draw just isn’t there compared to the caliber of cuisine in Vegas.

Owing to the fact that Vegas is an international tourist destination, you’ll find world class food of nearly every stripe in this city. Celebrity chefs the likes of Gordon Ramsey, Wolfgang Puck, Bobby Flay, Tom Colicchio, and Giada de Laurentiis all boast top quality restaurants in the most popular part of the city, but there’s phenomenal local talent off the strip as well.

Just to name a few, for local Thai food, Lotus of Siam was voted best in the country. Le Pho, a traditional Vietnamese spot offers the perfect bowl of pho and a DIY spring roll plate – fun to eat and delicious. Honey Salt, started by local restauranteur Elizabeth Blau, offers amazing farm to table cuisine, made with seasonal ingredients. And for a classic Italian meal, head over to Ferraro’s for a bowl of pasta or a generous osso buco.

Comparing Austin and Las Vegas isn’t exactly an apples to apples thing when it comes to music and entertainment either. Both cities have their merits. Whereas in Austin, you’re more likely to be serenaded by a local band or songwriter while you’re eating dinner on a regular basis, major acts usually only end up coming through for the major festivals a few times a year. It’s known as the live music capital of the world, but national acts don’t come through as often as they do Vegas. Home to upwards of twenty five music venues alone, Las Vegas hosts all manner of national music acts, performing artists and ensembles, and comedians. Just about anything you’d want to see live, you can find in Vegas on any given night of the week.

If you’re a sports fan, you’ll have to root for another city’s pro team as an Austinite, but Vegas has an NHL team (Golden Knights), and the Oakland Raiders are moving to Vegas for the 2020 season.

Proximity to Fun

As if everything I have already mentioned isn’t enough, Las Vegas is a short drive away from other major attractions in California, Arizona, and Utah. It’s kind of an amazing jumping off point. I love getting to enjoy all that Southern California has to offer without having to actually live in CA and endure the high cost of living there. Los Angeles, San Diego, Santa Barbara, and Anaheim (home of Disneyland, Knott’s Berry Farm, and Six Flags) are all a few short hours away, so we can pick up and head to the beach or a theme park for a weekend if we want. Go East instead, and visit Sedona, AZ or Brian Head, UT for a weekend of natural beauty and camping. We often drive to our house on the Colorado River in Arizona, an under 2 hour drive.

A Properly Hyped Vegas

When I was planning to move to Austin, so many people were excited to see me off. Austin has a great reputation all over the country for being a cool place to live. It’s progressive beacon in a sea of Texas red. It boasts an ever-growing tech scene and an amazing community of entrepreneurs. Monacres like “the live music capital of the world” and sayings like “Keep Austin Weird” make it famous. When you say you live in Austin, people pay attention and assume you have it made.

Not so with Las Vegas. Sometimes when I say I live in Vegas, I hear, “Oh, people live in Vegas?” Now you know the answer is a decided yes. People live in Vegas and actually really love living here because there’s tons to do. You get all the amenities of a big city and none of the setbacks. Little to no traffic, a major airport, phenomenal food, breath-taking natural beauty, entertainment, and lots of fun for the kids all make me proud to call Vegas home after my little soiree in Texas.

An Ultimate Guide to Choosing the right Natural Deodorant

Tue, 05 Jun 2018 11:22:01 -0700

Why Natural Deodorant?

We all want to smell nice. Which is why deodorants and antiperspirants are such big business. However, the commercial products that are masking your body odor are doing more harm than good. In fact, they may be making you seriously unwell.

Contrary to what you may think, it’s not sweating that causes you to stink. The smell is actually due to bacterias that live on your skin. These bacteria consume the proteins and fats that reside in your sweat and it is this process that causes body odor. Deodorants neutralize and kill the bacteria.

Research has shown conclusively that the aluminum salts contained in deodorants, such as aluminum hydrochloride, aluminum chloride, and aluminum-zirconium complexes can be absorbed into the body. The toxic effect on the body can be devastating to your ongoing health.

Aluminum enters the body through the skin and then makes its way toward the brain. Short-term side effects of aluminum toxicity include memory loss, lack of coordination, disorientation and muscle cramps. Research into Alzheimer’s shows that people who have more contact with aluminum are more likely to develop the condition.

Deodorants also include parabens, which are synthetic preservatives. This has been directly linked to breast cancer which most often occurs in the area where deodorants are applied. Studies have shown that 99% of breast cancer cells contain parabens. Parabens are also known to play havoc with the body’s hormonal system and to induce neurotoxicity.

Another nasty that can be found in your deodorant can is triclosan. This chemical can interrupt the normal functioning of your thyroid with resultant weight gain and decreased fertility. Triclosan has been classified as a pesticide by the EPA.

Propylene glycol is the ingredient that allows your deodorant to easily absorb into your skin. In large enough quantities, it can cause damage to the central nervous system as well as the heart and the liver.

There are other dangerous chemicals in your off the shelf deodorant, including phthalates, which are major endocrine system disruptors, and a huge list of fragrance enhancers that cause internal toxicity while making your smell sweet.

The bottom line is that deodorants are making you more toxic, more dysfunctional and less able to function optimally in your skin. That’s why the smart choice is to opt for a natural deodorant alternative.

Types of Natural Deodorant

Just like standard deodorants, natural deodorant comes in a variety of application forms. These include:

Solid

A solid deodorant comes in the form of a creamy bar, which is housed inside of a container. The bar is designed to easily melt when it is applied to the skin. The downside of solid bars is that they may start to melt in the intense heat. Conversely, they can get very hard in cold weather.

Roll-On

A roll-on deodorant consists of a container filled will a liquid deodorant which has a ball tip applicator on it. They are good for cold weather application but will often leave behind a residue.

Paste

Paste deodorants are not as common as the other varieties. However, they are effective at eliminating odor, but not so much with helping to prevent sweating.

Crystal

Crystal deodorants usually come in the form of mineral rocks. This is a very cost-effective deodorant, with most crystals being able to last for more than a year. Be sure, however, that your crystal does not contain aluminum in the form of alum.

Patch

Deodorants are also available in a patch form which is quite similar to a nicotine patch. When applied to an area of the (usually the underarm), the skin absorbs the ingredients (which include aluminum in most commercial versions) and prevents sweating and subsequent odor problems.

Spray

Spray on deodorants are among the most popular forms, especially for men. They have been shown to dry more quickly under your arms than other types of deodorant. Since 1994, the use of ozone layer-damaging CFCs in aerosol sprays has been banned.

Baking Soda

It makes a very effective deodorant. It does a great job of negating the bacteria that feed on the proteins and fatty acids in sweat, thus eliminating body odor. A small percentage of the population is allergic to baking soda, but the vast majority will find it to be a useful treatment.

The Best Natural Deodorants

Amazing Thai Crystal - Roll-On
Price: $6 (2x)

Amazing Thai Crystal roll-on is an aluminum free easy to use roll-on that dries fast and works great for 24 hours. Just like with any crystal-based deodorant there is no smell but you do sweat. It is made from crystalized naturalized mineral salts which kill bacteria. It contains no harmful chemical, perfumes or emulsifiers.
This product is hypoallergenic and is unscented and non-staining. A roll-on will last the average user for between 4-6 months.

Amazing Thai Crystal - Stone
Price: $10

The Amazing Thai Crystal Standard crystal stone is the same base product as the roll-on but in stone form. It’s not great for travel but works well and a single stone will last you a long time.

Crystal - Roll-On
Price: $11 (2x)

Crystal Roll-On is one of the originals and works great. There is no scent in this easy to use roll-on, it dries fast and works for at least 24 hours. The size of this roll-on is a bit small and the price high compared with others. It has very feminine packaging and all of the scented options are female-focused. The company makes many options and application types.

Crystal roll-on is made from natural mineral salts that form a natural layer of protection for the skin. Rather than masking the odor with fragrances, Crystal creates an environment which prevents the bacteria that causes the odor.

Crystal – Stone
Price: $14

This a standard crystal stone which provides you with a long-lasting deodorant option. Although the majority of Crystal’s products are marketed toward women, they have a nice men’s option which just changes the packaging.

Nasanta - Magnesium Deodorant
Price: $15

Nasanta uses a Japanese sourced magnesium as the basis of its deodorant. This product does a great job of negating the bacteria that causes odor. Magnesium is an important mineral in the body which is important for energy, nerve production, protein synthesis and muscle relaxation.

Many online reviewers with sensitive underarms find that this is the only natural deodorant that will not cause irritation. There is no scent associated with this product.

Crystal Active
Price: $10

Crystal Active is a solid crystal stone with no scent. It is smaller than the competition which makes it a little pricey. Just like all stones, it is a bit messy and hard to travel with. It features a long-lasting push stick and the effects of this deodorant will last for a full 12 hours. Crystal Active represents great value with a single 100 mg mineral stone lasting up to 2 years (and that’s with daily use).

Crystal Rock Body Spray
Price: $6.15

Crystal Rock Body Spray has a scent of West Indian Sandalwood and Vanilla. Unfortunately, the majority of reviewers consider this to be a horrible scent. You get a lot of product for your purchase. However, this is a very heavy spray so you are left feeling very wet after application.

Primal Pit Paste - Coconut Lime
Price: $12

Primal Pit Paste makes use of an aluminum free baking soda in order to neutralize odor-causing bacteria in the armpits. Added to this are organic coconut oil and organic shea butter, both of which are potent antimicrobial agents. This paste is also effective for use between the legs to prevent thigh chafing.

Primal Pit Paste has a nice clean, gender neutral, scent.

Schmidt’s - Charcoal + Magnesium
Price: $22 (2x)

Schmidt’s Charcoal and Magnesium are very expensive in comparison to the competition. However, this is an extremely effective product that will keep you odor free and sweat resistant for the entire day. The nice gentle scent is reminiscent of freshly falling rain. Magnesium is great for the body and absorbed well through the skin, so this is an interesting addition to the Schmidt range. It has a non-greasy, non-sticky feel which is very pleasant and very easily absorbed. The price factor is somewhat negated by the fact that you only have to use this product in small amounts.

Schmidt’s - Bergamot + Lime
Price: $12

The Bergamot and Lime scented Schmidt’s natural deodorant provide an enticing new scent which gives a natural, outdoorsy flavor. It provides the same great odor and sweat-wicking properties of Charcoal and Magnesium.

Underarmed
Price: $16

Underarm deodorant stick for women and men is 100% natural and organic. It contains organic avocado butter, beeswax, bergamot essential oil, coconut oil, castor oil, hydrogen peroxide, organic lavender essential oils and raw organic honey. One application will provide 24-hour protection. This is one of the more natural stick options that is not crystal. The manufacturers of this product are so confident that they offer a 30-day money guarantee, something which is quite rare in this industry.

Zionhealth - Claydry Bold
Price: $8.98

Claydry Bold is a stick product which makes use of a special type of healing clay called Calcium Montmorillonite. Among its other all-natural ingredients are arrowroot powder, coconut oil, and baking soda. Apparently, Zionhealth has recently changed the formula of this product and, according to quite a few customers, not for the better. It is not as fine as the previous version and does not go on as smoothly. The new version is also thicker and doesn’t smell as nice.

ArmPit Armor
Price: $10

Doc Spartan’s ArmPit Armor includes all-natural ingredients, including activated charcoal, arrowroot powder, baking soda, shea butter, refined coconut oil, beeswax and a blend of essential oils. This product was featured on Shark Tank and is getting great feedback in terms of effectiveness and customer support.

Sky Organics
Price: $13 (2x)

Sky Organics is a 100% natural, organic deodorant for both males and females. It contains coconut oil, shea butter, and carnauba wax and is specifically designed for sensitive skin. Each application provides 24-hour protection. It is fragrance-free and gender neutral.

Alaffia - Activated Charcoal
Price: $ 14.99 (2x)

Alaffia Activated Charcoal incorporates coconut, reishi mushroom, and shea into a very effective all-natural formulation that neutralizes the odor-causing bacteria under your armpits. It has a pleasant fragrance but will require a twice-daily application. The lack of permanence seems to be this product’s biggest issue.

Habit.com Nutrition Testing Review (Part Two, results)

Mon, 05 Feb 2018 12:13:21 -0800

The Habit nutrition testing results are in!

After a few weeks of waiting I got the email from Habit saying the results are in. I quickly went to the website and found a great interface with the results written in plain english as well as some nice detailed graphics.

I was pleasantly surprised they actually measured more than I expected in the blood samples given and even gave a comparison of the results between samples, which was nice.

On every page the plain sentences do a great job of presenting the information in what feels like a personalized way. Although I did not learn much new, only because I have done so many other tests, it was great to see the difference of samples across multiple measures. One of the best parts of the presentation was all the DNA related results. Although the raw data came from 23andMe, Habit actually presented both useful and educational information that 23andMe never did.

You are able to download all the results as a CSV which is nice but it would have been more useful to be able to download a nice PDF with sections. This could much more easily be shared with doctors or friends.

My biggest issue or complaint after all the nice results, personalization and interface is the recommendation or “plan” as they call it. It is pretty much the standard USDA recommendation of more grains (carbs), vegetables and fruits and less fat. Even though my body has no problem processing the fat and much of the science points to sugars and carbohydrates as the cause of most diseases of civilization.

So overall, it was interesting and fun to learn something more than the standard glucose test a doctor would do. I would think for much of the general public this would tell them a lot they had no idea about and is a good starting point. For the biohacking community that has already done biomarker testing, not much new will be learned.

Habit.com Nutrition Testing Review (Part One)

Tue, 23 Jan 2018 19:25:42 -0800

Having struggled with diets for years I was very excited when I saw the TEDx talk from Neil Grimmer about the idea of testing and personalization of food and diet. Of course building Darwin, I have done lots of tests so I ordered the Habit.com nutrition test the next day.

Here is a review of the testing process, experience and general thoughts. A future post will review the results and how helpful the data is.

Ordering Process

The process was simple but after the order there was no update of when to expect the testing kit to arrive and it actually took a long time for a box that required nothing special. It should be noted that since I already had a 23andMe, I was able to skip the DNA testing part.

Box

The box, instructions and content are beautifully designed, taking cues from Apple and others that have done a great job with packaging. Each item had a place with perfect placement. A nice touch that extras of most anything that could be messed were included and perfectly placed.

Instructions

Although a great attempt was made with both the written and video instructions, both were lacking important details or information. It was not hard to figure out but this could be improved.

Drink

The shake actually did not taste bad at all and was easy to drink. I never drink milk and being on a ketogenic diet the shake was a shock to the system but felt like a whole meal.

TIP: Make sure you refrigerate the shake prior

Testing

All I can say is wow, a lot of blood is needed and the lancets are made for the job. If testing just for blood glucose it would be easier and much less blood required but these test strips are very different. The website did a nice job of having a timer and other helpful stuff although the times are hard to understand compared with the instructions.

Results

After sending the samples back in, it would have been nice to get a confirmation it was received and after I followed up with support they said it would take 6 weeks or more for results. Hopefully as they get better at this the lab process will be quicker as almost 2 months is a long time to wait.

The real test will be what intelligence is actually returned with the results and how useful the data is. Stay tuned for a later post

Overall

Beautiful box, well put together and thought out makes for a great experience and compared to a medical setting or similar tests the experience is outstanding. There are areas for improvement but this is clearly a company and team that spent the time to try and make this a simple and fun experience for anyone that wants to do it.

Winter is Coming and What Startups (and Investors) Should Do to be Prepared

Fri, 18 Dec 2015 13:44:52 -0800

There’s no denying that startup valuations have increased dramatically over the past couple of years.

In January of 2014, 31 private companies were valued over $1 billion. In September of 2015, only 18 months later, that number has increased to 80 private companies valued over $1 billion.

Take a look at the chart above from CB Insights to get a better idea about how the investment and valuation landscape has changed for the past five years.

This chart clearly shows that either there’s been a fundamental economic shift or else company valuations are being inflated because there’s too much money flowing into the startup world.

I’m betting on the latter.

One reason is that there are unicorn companies that are selling products or services with a negative gross margin which is unsustainable (more on that here). At some point, these companies will be required to turn a profit, which can be difficult when your company’s growth depends on negative gross margins.

There also have been a number of startups whose value has been discounted after an initially high valuation. Examples include:

(1) Rdio selling to Pandora for $75 million after raising at least $125 million and being valued at $500 million.
(2) Snapchat being discounted 25% by Fidelity, one if its more recent investors.
(3) Dropbox being devalued by BlackRock.
(4) Fidelity marking down its investment in Zenefits, suggesting a $2.34 billion valuation compared its $4.5 billion valuation.

All of these examples show that a number of these unicorn companies are being overvalued by private investors, with a more accurate valuation coming out after mutual funds more realistically value their holdings or the stock market brings stratospheric private valuations back down to earth.

Yes, these companies are earning revenue, which is better than the dot com bubble of the early 2000’s, but at some point a company has to turn a profit in order to justify a billion dollar plus valuation.

This is why I’m predicting that winter is coming to the startup world sometime in the near future. It’s effect won’t be quite as drastic as the early 2000’s dot com bust, but I do expect the funding landscape to change drastically in the next 12 to 36 months after investors realize that current valuations are out of control and out of touch with real world economics.

So what should startups and investors due to be prepared?

First of all, if you’re expecting to raise money in the next 12 to 24 months, you may be in trouble because the same level of funding we’re seeing today may not be around that much longer.

So if your business plan includes raising more money in the near future, you may need to update your plan.

I personally get contacted about investments a lot, and I’ve been advising companies to boostrap well into the $500,000 to $1,000,000 revenue range. In fact, my partners and I are only looking to invest in companies with $500,000 to $1,000,000 in yearly revenue, positive gross margins, profitable, and with no plans to play the funding game, because the only reason a company really needs funding is to fuel growth. That’s it.

I wholeheartedly believe that bootstrapping is the right way to build a company. Everyone says you need money to scale, but that’s simply not true. You can be Whatsapp and get to a millions of users with no money. You can even build a hardware startup with no money. There’s no industry where you absolutely need money to start your business.

But right now it’s super easy to get money so raising capital is the default view, and the Silicon Valley mindset has spread to other areas of the world. Yet companies that need money to stay alive are going end up in fire sales, as we’re starting to see. That’s my prediction.

I talk to too many founders who say, “I’m going to raise a seed round now and an A round in 12 months.” My response to them is, “Why are we talking about an A round? Why aren’t we talking about your revenue and how to become profitable?”

That’s why, with the companies I invest in, we’re talking about growth plans and where to spend money to get customers, not what their future fundraising plans look like.

We’re also only investing in profitable companies because when the funding landscape changes, only companies that are profitable will survive.

From a founder’s perspective, this is how to build a company today. You bootstrap to $500,000 or $1,000,000 in revenue, and only then do you think about raising money to fuel your growth, not to get your company off the ground and not to acquire customers at a price that’s higher than the revenue you make from each new customer.

Take my most recent investment as an example—Groove. Alex Turnbull, the founder, didn’t need the money. Instead, he wanted access to my knowledge, experience, and the people I know. I believe the best companies are going to follow this path.

What I care about more than anything else is for the companies I invest in to be able to survive a change in funding economics. If they end up raising more money because they can, that’s one thing, but if their entire business plan hinges on needing to raise more money in 12 to 24 months, I don’t want to be involved.

Investors should also be paying more attention to these factors. In general investors need to be looking at business economics like revenue and profitability and not just investment valuations and what’s hot. Just because a Silicon Valley startup is being valued at $10 billion doesn’t mean the company is actually worth that much.

So my advice is this: if you’re a startup fueling growth with negative gross margins and looking to stay alive with future investment rounds, take some time to reconsider your strategy and whether or not you’ll be able to survive if the current funding well dries up. If you’re an investor looking to make smart investments, start paying closer attention to revenue and profitability and consider investing in companies where you’re fuelling their growth, not just propping them up for another 12 to 18 months.

There’s no way to know for sure when these changes will take place, but I’m certain of one thing—winter is coming to the startup world and it’s coming soon. It may be 6 months, it may be 12 months, or it may take a bit longer, but winter is definitely coming. The question to ask yourself is this—will your startup or investments survive when it does?

How to Build HealthCare.Gov for Less than $600 Million

Mon, 04 Nov 2013 05:16:34 -0800

By all accounts Healthcare.gov has cost a considerable amount to build. Some estimates place the cost between $174 million to $300 million, others between $350 to $500 million, and still others as high as $600 million.

But how does that compare to the private sector? Have tech startups built websites and businesses for less, or is this a reasonable amount of money for a portal that coordinates a national healthcare exchange? Let’s take a look at a few companies to find out.

Facebook, which has over 1.15 billion monthly active users, started with a $500,000 investment from Peter Thiel. They then received a $12.7 million round of funding from Accel Partners for a valuation around $100 million. A year or so later Facebook received another round of funding for a total of $25 million. Finally, in 2007 Microsoft invested $240 million bringing the funding total to $278.2 million.

That amount lasted for 7 years and was used to build a site that eventually would serve 1.15 billion active monthly users without crashing and to fund operations, pay salaries, invest in technology infrastructure, etc. So the rough estimate for HealthCare.Gov would have sustained Facebook for 7 years, not just been enough to get a broken site up and partially working.

Are there any other examples? Yes, let’s turn our attention to Twitter.

Twitter was started with an initial $5 million Series A round of funding in July of 2007. They later received $150 million in funding from Series B through D rounds for a total of $155 million in the first three years of operation. Once again, that’s less than was needed for the current Healthcare Exchange website and was spread out over a period of three years, not spent before the site was even launched.

A few other examples are Instagram which was built for $57.5 million, LinkedIn which was built for $200 million, and Spotify which was built for $288 million.

All five of these are examples of large, complex private companies that were launched and maintained for less than Healthcare.gov has cost just to build. You may be thinking that none of these are as complicated as Healthcare.gov, but an argument can be made that they’re equally complicated. And at the very least, the difference in complexity isn’t enough to justify $300 to $600 million just to get a website off the ground because that amount doesn’t included fixes (something the government is ponying up to pay for right now), ,maintenance, and inevitable upgrades.

Another comparison can be made with the Apple iPhone. The original iPhone reportedly cost $150 million to make, which is less than one half the conservative estimate for how much the healthcare exchange website has cost so. One is a completely new handheld device that requires a brand new operating system and the other is a website that communicates with other companies and government agencies. It doesn’t seem like a single website should cost twice as much as a brand new device the world has never seen before.

At this point you may be thinking, “Those are good comparisons, but none of them are as critical as a Healthcare Exchange. If one of those sites go down, people can no longer send tweets. It doesn’t mean that American citizens will lose healthcare coverage for periods of time.” Ok, that’s fair, but there are other examples.

ZenPayroll for one built a complex system that deals with taxes and can’t tolerate bugs because it’s connected to people’s paychecks. They launched with $6.1 million in funding, a.k.a. 1% of the upper estimate for the Healthcare website, and they’re doing quite well. Companies like this prove that complex problems can be solved with error-free technology in spaces where there’s zero margin for error.

A few other examples, this time from the healthcare space, are SimplyInsured, CakeHealth, and Eligible API. All three are creating exciting technology related to healthcare and are operating off of a first round of seed funding. The technology they’re building has to do with health insurance and healthcare and also has no margin for error.

All in all, Healthcare.Gov has been an expensive project that so far hasn’t worked as well as was planned. Even though most of us probably expect nothing less from the Federal Government, my point isn’t to rail on President Obama or the Federal Government. My real goal is to point that there are better and less expensive ways to build a website that’s so important to the American public and will be spending taxpayers’ dollars. Here’s my solution…

How to Build Healthcare.gov for Less Than $600 Million

How would I have managed the project? First, I would have created a startup competition similar to NYC Big Apps, or any of the other startup competitions like the X Prize. This would draw out the best and brightest companies and individuals in the country to compete for the contract. The first round would take place in year one, and three winners would be selected to receive $15 million in funding (for a total around 10% of what people are estimating the current site has cost).

After the first year, and with only $45 million invested, there would be three companies solving the problem amazingly well, and there would be competition to spur each of them on. The winners would go from $0 to $15 million in funding and would continue to compete for government contracts to run the exchanges. Near the end of the second year, each state could pick which company to work with based on which solution they thought was the best. All three would likely be performing at a high level, but if not, states could choose the website that met their need the best.

The end result would be a product that works incredibly well and costs significantly less than the current exchange. New startups would be born in the process, US jobs would be created (as opposed to handing a multi-hundred million dollar contract over to a Canadian company), and the American economy would be stimulated. It would also deal with the problem of government contracts that get awarded based on legacy work and instead would reward the solution that performed the best.

I’m not saying you should vote me for President because I would run projects like this perfectly, but I am saying there are better ways to build a website and more efficient ways to spend taxpayers money. There’s no excuse to pay $350 to $500 for a single website that’s going to require additional maintenance and upgrade costs to continue running. That amount of money has been used to sustain amazingly complex tech companies for four to seven years or more. If those companies can launch with significantly less money, there’s absolutely no reason Healthcare.gov couldn’t do the same.

What are your thoughts? Do you feel like the project could have been managed better? Do you have any suggestions on how that could have been done or additional comments about my solution? Leave a comment so we can discuss.

Sources:

http://www.digitaltrends.com/opinion/obamacare-healthcare-gov-website-cost/

http://www.crunchbase.com/company/twitter

http://www.crunchbase.com/company/facebook

http://www.crunchbase.com/company/zenpayroll

http://www.forbes.com/sites/timworstall/2013/10/17/developing-obamacares-health-care-exchanges-has-cost-more-than-apples-original-iphone/

The Startup Side Project Bubble

Mon, 08 Apr 2013 07:22:50 -0700

I hate to break it to you, but there’s currently a startup side project bubble. Yes, it’s true.

Everyone from designers to developers to UI/UX to biz dev thinks they’re an entrepreneur and has a side project going on. Why is this happening, you ask? It’s because everyone wants to be an entrepreneur, but they’re not quite yet ready to commit.

This creates a big problem.

It’s a problem because side projects create a talent bubble of people who aren’t fully engaged and are just doing enough at their “real” or full-time job to get by until their startup is up and running. This means their productivity suffers at their full-time job, an expense the employer ends up paying. The side project owners justify it by assuming it will only be for a short period of time.

But when it comes down to what actually happens, startups often take longer than expected to get up and running all while the job and the startup limp on. The employee doesn’t excel at his job nor does the startup take off.

And actually, we need to be honest. Not everyone is an entrepreneur. Part of being one is accepting the risk of starting your own company and taking the leap to be committed full time. It’s not good for startups or for companies to have employees that are partially engaged in both and committed to neither.

Thom Ruhe, vice president of entrepreneurship at the Kauffman Foundation, had this to say about the criteria needed to be a successful entrepreneur as quoted in the Editor’s letter of the April 2013 edition of Inc. magazine:

“‘Unless there are real consequences for failure—until you’ve personally guaranteed a line of credit and tried to sell your product to an actual human being,’ says Ruhe, you won’t have the motivation needed to build a business that matters.”

The worst part is that a lot of the side projects end up being another attempt at the next social network or a new project management app. Here’s a quick tip: there are plenty of those already. If you do want to start a company, work on building a real business, not a side idea that’s hoping to be the next Twitter/Facebook/Instagram combination or a better version of Basecamp.

On top of all of this, lean startup principles create a problem as well. Lean principles are great, but they’ve created a group of people who take them as a license to create cheap or low-risk projects on the side. Yes, you can use lean startup principles to lower risk and find a minimally viable product faster, but you still need to commit to your business and give lean principles the effort they need to power your company to success. And always remember: lean doesn’t mean you get to create a crappy product; it means you iterate and experiment quickly in order to find a product that resonates with your customers faster.

The biggest problem with side projects is that the lack of commitment dilutes the startup talent pool, hurts the side project or startup, and in turn kills great startups from succeeding. If you’re looking to start a business, take some time to consider whether or not you’re ready to be all in.

Yes, you can save some money to prepare yourself for the eventual leap. And yes, you should consider carefully whether or not you’re ready to start a business. But don’t shoot yourself in the foot by stringing your employer along and delaying the leap to becoming a full-time entrepreneur. The choice is yours, but too many people are making the wrong one. I hope you have what it takes to commit and become a real entrepreneur.

What are your thoughts? Leave a comment to discuss.

What's Wrong with a No-Remote-Work Policy at Yahoo?

Wed, 27 Feb 2013 06:05:53 -0800

Like many others who pay attention to Hacker News, on Monday I read the 37Signals entry titled “No more remote work at Yahoo” where David Heinemeier Hansson, creator of Ruby on Rails and partner at 37Signals, rants about his disapproval of a recent Yahoo policy that asks all employees who work from home to start working in the Yahoo offices beginning in June. Here’s what the new policy says (as quoted in the 37Signals post):

Beginning in June, we’re asking all employees with work-from-home arrangements to work in Yahoo! offices. If this impacts you, your management has already been in touch with next steps. And, for the rest of us who occasionally have to stay home for the cable guy, please use your best judgment in the spirit of collaboration. Being a Yahoo isn’t just about your day-to-day job, it is about the interactions and experiences that are only possible in our offices.

This ended up being newsworthy because so many companies are going in the other direction when it comes to remote workers. Small startups are getting founded with remote teams that work across countries and time zones and larger companies are experimenting with work-from-home arrangements to save time and money for the company and employees.

In many cases, remote-worker policies work out well, but for a company that has been struggling like Yahoo, is it really such a bad idea to bring all of the troops back to the office to strengthen the Yahoo culture and foster innovation and collaboration? I for one don’t think it’s a bad idea. Here’s why…

Reason #1: Yahoo is failing

Currently, Yahoo is failing and is in need of radical change. It needs people to leave, and it needs to have a fresh outlook. To do this, it needs to do some things that are controversial. Sure, this policy may not be popular with everyone at Yahoo, but it’s worth it if it gets the company back onto the right track.

Reason #2: Company culture is important

Having a strong company culture is important for having a successful company, and the best companies with core values that get celebrated are companies that have most if not all of their employees in their office. Zappos is a great example of this. They relocated from San Francisco, CA to Henderson, NV for cheaper office space and lower cost of living, and most of their employees came with them. How’s that for a crazy company policy that requires employees to work together in the same place? The result is one of the strongest company cultures in the world, if not the strongest. Companies with great culture and remote workers still at least have a core group in the office to maintain a strong company culture.

Reason #3: Remote work is hard to scale

It is very hard to scale a company that has a majority of remote workers. Anyone with a sizeable team of 5 to 10 people knows that you have to have in-person meetings which requires travel, hotels, etc. Yes, 37Signals pulls it off, but they’re also a small company. When you’re trying to scale remote workers and build a strong company culture at the same time, it’s hard to do. Large companies are very different than small companies, which is something that has to be taken into consideration when reviewing policies like this. Growing a startup like 37Signals that admittedly wants to stay small is very different than managing a large, struggling company because success at a growing startup hides all sorts of issues that aren’t hidden at a company the size of Yahoo.

Reason #4: Maybe remote work wasn’t working

It’s very possible (likely even based on the new policy) that the current culture of remote work wasn’t working at Yahoo. Maybe it wasn’t managed well in the past and currently isn’t productive, but it’s impossible to know without being on one of the teams within the Yahoo offices. So without further info on the productivity of Yahoo’s current remote employees, any comment on this is merely speculation.

Reason #5: The policy can change

Yahoo didn’t say they’ll never allow remote work in the future. They simply articulated that at this time there is a need for everyone to come into the offices to build a strong sense of what it means to be a “Yahoo” and to facilitate “interactions and experiences that are only possible in [their] offices.“ Once the company gets back on track, it’s possible that this policy can be loosened. They’ll likely never be a majority-remote-employee company, but they may once again make allowances for remote workers and be more lenient for people who need to “stay home for the cable guy.”

Reason #6: Very few people can work remotely

Not everyone can work remotely. It takes discipline and a certain type of person with years of practice and experience. It’s possible that the wrong people were working remotely. However, once again, with that said, there’s no way to know for sure without having information that’s only available to Yahoo employees and managers.

Closing statement

What I’m really trying to get at is that if I was rebuilding something that had been limping along for years, I would want people in the office to experience the new culture and build the company we were going to be moving forward. Marissa Mayer seems to be doing a decent job with this so far, and we should all wait before passing judgement on this decision to curb remote-working at Yahoo.

The 37Signals post mentioned that Yahoo isn’t Google or Apple and therefore doesn’t have the clout to require workers to be in the office while still hiring the best talent. I would argue that, since they want to be a Google or an Apple, then they need to put policies like this in place first in order to build the strong company they desire to be. In the end, David Heinemeier Hansson is entitled to his opinion, as is everyone else, but really, only time will tell whether or not this was a good decision by Yahoo, so let’s wait and see.

The Internet Bubble Wasn't All Bad Ideas

Tue, 29 Jan 2013 06:13:14 -0800

We all know the story well: at the end of the 1990’s and the beginning of the 2000’s investors threw caution to the wind and invested heavily in businesses based solely on the fact that they added “.com” to the end of their name. They overlooked standard investment metrics like earnings per share, and instead based their investments on the expectation that new internet customers would lead to earnings booms. Some companies even IPO’ed before making a “net” profit.

And then it happened.

The market corrected, stock prices dropped, and most of these companies went bankrupt. They no longer could get the funding they needed, and since they weren’t making any money, they went under. It became known as the dot-com era bubble.

So now everyone looks at the dot-com bubble and thinks of it as an era filled with bad ideas and poor investment principles. But that’s not actually the case (although the “poor investment principles” label still applies).

Instead of being an era full of bad ideas, most of the businesses were ahead of their time. They were viable ideas that were being pushed ahead of the technical capacity that would make them profitable. They also suffered from an attempt to get too big too quickly.

Example #1: Pets.com

Let’s take Pets.com as an example since they’re known as one of the biggest dot-com era busts. They started operating in August of 1998 and closed down in November of 2000. During that time they became nationally recognized through successful advertising and PR campaigns. This led to sales, but not enough to sustain profitability. By the time they shut down in 2000 they had lost $300 million in investment capital.

So what was the problem?

For starters, 1998 wasn’t the best time to start an online pet supply store. The internet was still in its infancy. People weren’t surfing the web all hours of the day on devices ranging from desktops at work to smart phones in bed. And they weren’t used to making purchases over the internet. The average consumer was more comfortable buying pet supplies from a local store than an online retailer. People weren’t yet ready to make the switch.

So was selling pet supplies online a terrible idea? No, actually it wasn’t. It suffered from bad timing and trying to grow too quickly, but the idea itself wasn’t bad. Pet food alone is a $52 billion per year business with $666 million being sold online in 2011. Today sites like PetCo.com, PetStore.com, and PedMedsExpress.com are making money by selling pet supplies online. PetFlow.com, a two-year-old company based out of New York, was expected to earn $30 million in sales in 2012 based on their subscription model that delivers pet food to customers’ doorsteps.

As you can see, there are now lots of companies that are making money by selling pet supplies online. Are they worthy of $300 million in investments and splashy initial public offerings that appoint them as the next big thing? Probably not. But they’re making money by doing the exact same thing Pets.com did from 1998 to 2000. They’re just being a little smarter about it, and benefiting from the current internet shopping habits of American consumers.

Example #2: Kozmo.com

Another big-time dot-com era bust is Kozmo.com. They attempted to provide same-day delivery of everyday goods like magazines, food, and Starbucks coffee. Kozmo’s numbers in 1999 looked something like this: $3.5 million in revenue and $26.3 million in losses. They also raised around $250 million in funding and offered services in Atlanta, Chicago, Houston, San Fransisco, Seattle, Portland, Boston, New York, Washington D.C., San Diego, and Los Angeles. Unfortunately, they ended up shutting down in April of 2001 which led to the firing of 1,100 employees.

What happened? Was this simply a terrible idea?

No, but it was executed quite poorly. Here’s one description that Wikipedia provides:

Despite serious concern and many suggestions from its employees to require a minimum purchase and/or a delivery charge, Kozmo continued to use the same business model of free delivery no matter what the price, even if it were a $.50 pack of gum or candy bar.

As you can see, Kozmo made the poor decision to offer their service to everyone free of charge. This simply was not sustainable. There needed to be some type of service charge or minimum purchase requirement. It also seems like they grew too quickly by expanding to so many cities without proving their model in a handful of cities like New York, Boston, and San Francisco. But the Kozmo business model wasn’t entirely a bad idea. Parts of the concept are still being used today. Chris Siragusa, the former CTO, went on to found Manhattan-based MaxDelivery which operates with a similar model to Kozmo and is still in business.

There are also many retailers who are considering how to use same-day delivery to boost their sales. Amazon currently offers it in select cities, and other companies like eBay and Wal-Mart are looking into how to offer similar services for their customers. Net-a-Porter, a designer apparel site, offers same day shipping in London and New York for a $25 charge. The U.S. Postal Service is even testing same day shipping in San Francisco.

Based on these examples, it seems like Kozmo was ahead of it’s time and attempted to grow too quickly more than it was a bad idea. There’s no way to know how this same-day-delivery market will evolve, but as these cases show, companies are still looking into how to make money from it, 11 years after Kozmo went out of business.

Example #3: Diapers.com

Similar to Pets.com of the dot-com bubble era, Diapers.com started selling specific products to be shipped by mail, only they started in 2005. Their focus was on baby products which included diapers, wipes, formula, clothes, strollers, etc.

Unlike Pets.com, they ended up being very successful. The company grew quickly, became rated as the #1 retail business by INC. magazine in 2009, and formed a sister company, Soap.com to sell soap-related products, in 2010. Their expected revenue in 2010 was $300 million which was up 67% from the year before and which led to their being acquired by Amazon for a price of $545 million.

Diapers.com is similar to Pets.com in that it offered a niche group of products to specific customers that were sold via the internet and delivered by mail, but it was different in that, instead of losing $300 million of investment capital, it earned over $300 million in revenue and was acquired by the larget e-Retailer in the world for $545 million.

Since the ideas were so similar, what made the difference?

The answer is timing. Consumers weren’t as ready to purchase from e-retailers in 1999 as they were in 2005. Shopping habits have changed over time, and more consumers are both online and willing to purchase via the internet. This is proven by a company like Petflow.com selling $30 million worth of dog food over the internet, and it’s proven by Diapers.com becoming an acquisition target of Amazon.com.

The question to ask

So the question to ask is this: Was the dot-com era filled with bad ideas, or were many businesses started with good ideas that were executed poorly and suffered from bad timing? I tend to think that in a surprising number of cases, the latter is true. Tech pioneer Marc Andreeseen has the same opinion. Here’s what he has to say about the subject:

“One of my working theories right now is basically every single idea from the dotcom era was correct.”

What do you think? Is Marc’s theory true? Was every single idea from the dot-com era correct but ahead of its time? Do you have any other examples of dot-com era busts that have now been proven to be successful? Leave a comment and let’s discuss.

Sources:
Dot-Com Bubble - Wikipedia
Pets.com - Wikipedia
Kozmo.com - Wikipedia
Diapers.com - Wikipedia
Retailers battle for pet food market share - TheCityWire.com
Eight things Marc Andreessen said to Quartz that made us sit up and listen - Quartz.com

Why "The Men Who Built America" Is a Must Watch for Every Entrepreneur

Thu, 10 Jan 2013 08:37:34 -0800

The Men Who Built America.

It’s a History Channel series that explores the lives of five men who lived the American dream and became some of the wealthiest businessmen in U.S. history—Cornelius Vanderbilt, John D. Rockefeller, Andrew Carnegie, J.P. Morgan, and Henry Ford.

If you haven’t heard their stories before, you’ll learn how Vanderbilt, Rockefeller, and Carnegie went from rags to riches, starting with nothing and going on to become the richest men in America. You’ll also learn about the events and connections that led to their success, the rivalries they had among themselves, and some of their greatest failures.

For example, you’ll learn that Andrew Carnegie was an immigrant from Scotland who started working as a child laborer in a button factory. He benefitted from a free library made available by a local businessman, Tom Scott, who shared his books with the working boys of the town. Eventually, Scott took a liking to Carnegie and brought him on as his assistant.

Carnegie continued to be promoted until, at age 24, he was made manager of Scott’s company. In his new position, he was tasked with building a bridge across the Mississippi River—a feat that had never successfully been completed. It was during this project that he discovered steel was the only metal strong enough to withstand the current of the mighty Mississippi.

The project ultimately led Carnegie to envision the role steel would play in the industrialization of America, causing him to invest all of his money into steel production. The bet paid off, and due to the Bessemer steel-production technology he discovered that made steel production more efficient, he became the top supplier of steel for the railroads, bridges, and skyscrapers that were being built across America.

He also created a business model in which he owned the raw materials, the steel manufacturing, and the transportation infrastructure. This maximized profit and later became known as vertical integration.

By the start of the 20th century he was one of the wealthiest men in America. However, the wealth of the man who had forced Carnegie’s former mentor out of business still surpassed his. His grudge against this man—John D. Rockefeller—led to a financial rivalry that continued for many years.

Carnegie eventually sold his steel mills to J.P. Morgan, thereby surpassing Rockefeller and becoming the richest man in America. He then started giving away his money to charitable causes, becoming one of the greatest philanthropists America has ever known. He donated the equivalent of $4.3 billion in today’s money.

By watching The Men Who Built America, you’ll learn in more detail about Andrew Carnegie’s journey from rags to riches and about the lives of these four other legendary entrepreneurs. You’ll learn that Cornelius Vanderbilt started out in the shipping industry before selling all of his ships to invest in railroads.

Why would he make such a drastic pivot? He did it because he saw the future role the railroad industry would play in building America. Much like the other entrepreneurs featured in the show, one of Vanderbilt’s greatest attributes was an ability to “see around the corners” and envision the future. This was a key characteristic that led to the success of all five of these men.

You’ll also learn that when Theodore Roosevelt became president, he began to enforce anti-trust laws against the monopolies controlled by these men. He was motivated by the harsh working conditions and poor wages that monopolies generated for the working class. This led to a new way of doing business, spearheaded by Henry Ford, who increased wages for workers and standardized the 40 hour workweek.

Through the anti-trust legislation, the implementation of the assembly line, and increased wages for working people, a new class emerged in the American economy—the middle class—which led to improved living conditions and more buying power for the average worker.

But none of this would have been possible without the staggering advancements brought in by the Vanderbilt railroads that carried goods rapidly across America, the Rockefeller kerosene that lit homes and businesses, the Carnegie steel that became the backbone of American buildings and infrastructure, the Morgan investments that brought electricity to every home, and the Ford Model T that made automobiles affordable to every family in the nation. It’s contributions from entrepreneurs like these five legendary men that have built America into the economic and political world power it is today.

So if you have any aspiration to become an entrepreneur who takes advantage of the technical advancements of your time, who shapes the future of our country, and who gives back for the improvement of society, I highly recommend watching this incredibly educational show produced by The History Channel. It’s inspiring, it’s informative, and it’s entertaining. What more could you ask for?

Full episodes are available by DVD as well as on Amazon and iTunes. Watch it today! (And no, I’m not getting paid for this endorsement. I just feel strongly enough about the show to promote it on my own.)

25 Entrepreneurs Tell What They Wish They'd Known before Founding Their First Startup

Wed, 07 Nov 2012 06:57:00 -0800

Hindsight is 20/20. When you look back on any project or endeavor, you get a better idea of what was important and what wasn’t.

The same is true with startups. After working on a business for a year or two or more, you have a better idea about what was worth worrying about and what wasn’t as big of a deal.

Since entrepreneurs are the most qualified to give other entrepreneurs advice about starting a business, I decided to ask 25 entrepreneurs about the number one thing they wish they’d known before founding their first startup. Below is a collection of this advice. It’s invaluable whether you’ve recently started a business or you’re looking to start one. Enjoy the post, and leave a comment if you have a question or a response.

The advice:

That you’re not supposed to know how to do anything right, and that’s o.k.

It wasn’t till I sold Spheric and started working on Flowtown that I realized that you didn’t need to know how to do anything in the beginning - you just needed to get good at finding the right answers quickly. If you focused on learning, getting the right advice, in near real time - then you could take on any challenge. It’s quite liberating once you realize that.

Dan Martell (@danmartell), Founder of Clarity I wish I knew how to price test. When we first released the product we based pricing based off of what we wanted to charge, versus optimizing price to achieve maximum revenue and profitability.

At one point in time our customer base requested a lower pricing option. We did it because their was a high demand for it. Although it increased the total number of signups, it decreased our overall revenue. If we knew about price testing during that time, we wouldn’t have made this big mistake.“

Neil Patel (@neilpatel), Co-founder of Crazy Egg I wish that I knew how difficult it is to acquire a customer, get them to pay for your product and believe it’s as magical as you think it is.

Most startup founders count on customer acquisition as a foregone conclusion, yet it’s the number one thing that keeps them up at night for the first 2-3 years if not longer. Every part of that process is deeply challenging for a company. It also doesn’t happen quickly.

A few tips on how to navigate early stage customer acquisition challenges:

1) Talk to every person in your target market that will speak to you. Know their needs better than they know them. Your most valuable insights will come from talking to customers daily.

2) Marketing to potential customers is a series of experiments. Before you start, define what success/failure looks like. When the experiment is over, rinse and repeat.

3) Surround yourself with team members and advisers that will hold you accountable to the business’ metrics and finances. The success/failure of the business depends on these people. You must trust them completely because you don’t have time to look over their shoulder.

Nick Francis (@nickfrancis), Co-founder and CEO of Help Scout Wow, the number one thing…

My business partner, Steve Bristol, and I really used to put in major hours the first years of the company. We were working 80+ a week. After working ourselves to a point of being burned out we realized that if we put in 40 x 2 hours the company didn’t move forward 2x faster. In fact those extra 40 hour were less productive than the first 40 hours. The reality is you’ll never be "done” with your work, you’ll never finish all the tasks, build all the features and have the perfect design. At the end of the day, around 4 pm, we close our laptops and go home. Never forget work is here to enable your personal life fruitful.

Also I no longer care how famous I become, I don’t care about being filthy rich or being on the cover of magazines. I care more about making our customers and employees happy. The only people I care about being famous to are my children and wife. I do still, even at the age of 32, still strive to make my parents proud of me. I’ve let go of the burden of trying to focus the company to a $500 million company, I’m happy being the co-founder of an unknown software company.

Misc Tips

1) Only hire people you’d want to hang out with during personal time.

2) The first 10 hires set the tone for the whole company.

3) Don’t hire people that are getting a salary bump up by working with you.

4) Don’t wear white pants after labor day.

Allan Branch (@allanbranch), co-founder of LessAccounting The number one thing I wish I knew is that the people around you affect your success more than you would ever imagine.

Focusing on who you spend time with on a day to day basis, working with doers instead of talkers can make or break the progress of your business and more importantly self-improvement. Be selective who you choose, Jim Rohn put it best:

“You are the average of the five people you spend the most time with.” Jim Rohn

(source: http://lifehacker.com/5926309/how-t#mce_temp_url#he-people-around-you-affect-personal-success)

Leo Widrich (@leowid), Co-founder of Buffer I wish I would have better known the value of my time. A ‘10 minute chat’, which always leads to a much longer chat, was so easy to say yes to. It took me years to finally start saying NO to things that would take me away from what really needed my attention. No to meetings. No to interviews, and no to extra projects (for extra money.) When I implemented my daily to-do lists my whole day/week/month changed. I would only accept opportunities if they could come after my to-do’s were completed.

Part of this realization came from a quote my grandfather once told me,“If you are not 10 minutes early, you are 10 minutes late.” He meant this for many reasons; Showing up to meetings, flights, phone calls, the gym and so much more.

So, that’s it; time is the most valuable thing you have. Make sure you invest it wisely.

Renee Warren (@renee_warren), Co-founder of Onboardly I knew that it takes time to build a product, but I also wish I had known that it takes time for users to adopt a product. While there maybe early adopters who can get wedded to your product, mainstream adoption takes a lot of time, and effort. Mainstream adoption requires people who aren’t early adopters, those who are more reluctant to change, to discover your product, understand the value proposition, be willing to try it out, then actually use it and pay for it, and finally develop enough of a following to want to tell other people about it. This cycle takes a while because it requires a product to be solid, for a user to develop a relationship with your company and your product, and then finally develop enough attachment to want to talk about it with others.

While marketing efforts can plant the seed, a lot of time needs to pass where the product is out in the market, in order for mainstream adoption to take place. Giving things time is hard for a founder to process, because as a founder you want to think you are in control, and can make things happen, but sometimes you just have to be patient and wait!

Poornima Vijayashankar (@poornima), CEO and founder of BizeeBee Build a public working prototype as quickly as possible and then iterate furiously.

Our plan at BetterDoctor was to build the first MVP product in two months and get it to release it publicly. We got this done, but it was so light on the viability side that we could only release it in closed beta. Closed beta meant very few users and little real world feedback.

In the end it took over six months before we finally launched the first beta product, which was still very much an MVP. Now after a year we have released BetterDoctor search service nationwide and have a stable platform to build upon. Today we can release new features in couple of days and test them with real users immediately.

Year is a long time, and if there is any way to get the product to consumer hands sooner you should try to do it.

Ari Tulla (@umbar), CEO and co-founder of BetterDoctor I wish I knew how big the opportunity was so I could have better planned to take advantage of it. Now that my company is older and more structured it is great to be able to focus on strategy, rather then just reacting all the time. At the beginning if I had stepped back and developed and funded a better plan I could have saved myself making a tonne of mistakes. That being said these mistakes are what my education is built on and learning from them is why I think I will continue to be successful. (I would like to have made a few less mistakes though.)

Andrew Angus (@andrewangus), Founder and CEO of Switch Video Don’t guess at price. So much is dictated by the way you price your product and many first-time Founders default to what they “think” customers are willing to pay for it (myself included). Focus on the value you are creating for your customers, not on what it costs you to deliver your product or service.

It also turns out that there are entire methodologies designed to help you extract the ideal pricing structure from your target market (Google “von westendorp”). Equally as important is finding out what product features your customers find most valuable.

By combining “willingness to pay” data with your customers’ most desired features, you’ll have a grounded approach for uncovering the pricing structure that attracts the right customers and drives the most profits for your business.

Mike Arsenault (@mikearsenault), Co-founder of Rejoiner Never take advice from anyone who hasn’t done or isn’t doing what you want to accomplish.

Ethan Bloch (@ebloch), Co-founder of Flowtown Ideas are great, but it is extremely important to think backwards from distribution. Ask yourself, who would use this, and how would they hear about it?

A lot of times, that will uncover the critical features you need to build into a product to make it useful enough for a user to tell their friends about it.

Kapil Kale (@kapilvkale), Co-founder of GiftRocket Look backwards in time.

The things that first time entrepreneurs spend the first few days of their life as a founder worrying about usually don’t matter. When I talk to new founders today, I generally get questions about how to structure the company legally, whether they should leave work now or wait for a bonus to appear, et cetera. Experience shows that these things do not make or break companies.

Instead, I wish first time founders would spend the critical first few days of their life is a founder thinking about their customers. What those customers need, and understanding that intimately better than the next guy, will make or break your company. The best way to do this is to look backwards in time. Pretend it is four years from today and you have a successful company, and ask yourself: is the question I am agonizing over right now likely to be the thing I will agonize over four years from now? The answer is usually no.

Bo Lu (@futureadvisor), Co-founder and CEO of FutureAdvisor It’s important to pick a big, growing market where you have some distinct advantage. And, to ensure that you control your own destiny and are not overly dependent on others.

Dharmesh Shah (@dharmesh), Founder and CTO of HubSpot Seek out the most critical opinions of your plan that you can find. The natural tendency for a first-time entrepreneur is to fall in love with an idea and then look for friends and colleagues to support it. After all, who wants to have a fledgling idea crushed by naysayers? But these are exactly the types of folks you should be looking for.

Have them shred your plan and designs from top to bottom. If you find yourself agreeing with them and having doubts, then your plan (and possibly you) may not have the mettle to make it. But if you are able to defend it with conviction, repeatedly, then you probably have both the moxie to last through the long, tough grind you’re facing, as well as a plan that just might work.

Blake Williams (@blakewilliams), Co-founder of Keepsy It’s well known that “premature optimization is the root of all evil”, but somehow I failed to recognize that when we spent a lot of time playing with different databases before we even had any customers. In the beginning it’s ok to validate your assumptions with a half-baked product.

Otto Hilska (@mutru), Founder and CEO of Flowdock The one thing I wish I knew before founding my first startup would have been how to set clear and measurable goals. The problem with any startup is that there are a million unknowns. As you go through the journey of creating your company, you try and answer as many of those questions as possible and once enough are answered, you know you have actually created something. Along the way, it is easy to get lost. To make sure you don’t, you need to be able to set clear goals and measure the success of your actions. If you see something isn’t working, it is imperative that you recognize it as soon as possible and fix the issue or change course quickly. Goals and metrics are the only way to do so.

Rami Essaid (@ramiessaid), Co-founder and CEO of Distil I wish someone had taught me earlier that you should be optimizing for speed and not cost. Everything in startups is about speed and your ability to move quickly. We were bootstrapped for a long time before raising a round, so we didn’t have much of a choice but to be super frugal, but I do wish that I learned that lesson earlier since it makes all the difference. If it takes an hour of your time to hack something together to save $20/month, then it’s not worth it.

Alex Schiff (@alexschiff), Co-founder and CEO of Fetchnotes Coming from MIT, I got lots of really good advice about starting a company - the importance of vesting, team chemistry, and building a good product. I wish that I had known more about the emotional roller coaster of startup life. Often when startups are portrayed in movies or TV shows, it’s a bunch of twentysomethings playing foosball all day and partying all night. What they rarely show are the lows that accompany those highs.

Never in my life have I been rejected as frequently or as vehemently as I have for Leaky. After all of the countless rejections, the scrapping to make payroll, and the cease-and-desist letters from insurance companies, what I learned was that you need fortitude to look past the temporary highs and lows to know that no gain or setback is ever permanent - otherwise, it would never be possible to get out of bed in the morning.

Jason Traff (@jasontraff), Founder of Leaky There will be a lot of ups and downs. When you feel down, stay calm and know that things will get better. When you feel up, enjoy the moment but save some of that for a rainy day.

I’ve been fortunate to have worked at multiple startups to know roughly what to expect. Reading Hacker News regularly gave me a good head start. Most every top rated advice you read there will come into play.

Be prepared that founding your first startup is likely the hardest thing you have ever done in your life to date. It’s not at all glamorous. Seek full support from your spouse (if you have one), and seek out co-founder(s) that you can fully trust and work well with. Ultimately, I cannot imagine a better professional experience than founding your very own company!

Tri Tran (@tritran), CEO and co-founder of Munchery Focus is more important than you can ever imagine.

Ash Rust (@ashrust), Co-founder of SendHub Starting NatureBox has been an amazing experience for me and I will be forever grateful for having the opportunity to start this company. I think it’s important for founders to know that when starting a company, they are about to embark on an emotional roller coaster ride. Managing your emotional state will become so hard but so important. When you hit a low point, remind yourself that it is just a bump in the road.

You can loose so much time worrying about things that don’t even matter. You’ll get good and bad news all the time and you’ll feel like your life depends on the success of your company but keep your head down and execute.

Gautam Gupta (@gRamblings), Co-founder of NatureBox I wish I’d known that running a startup team is a lot like parenting. You check up on them, you wonder what they’re doing and you worry about them Skype-ing while driving. Often, you have to yell “Everybody calm down!” On some days, you have to remind them to buckle down and get their work done before dinner. On other days, you have to entertain them, so you take them to see movies and drive them to a go-karting arenas.

As a startup founder, you want to help your team identify their strengths on the job and support them. You want them to make mistakes and learn from them, instead of shying away from them. You don’t dictate, you ask, “What do YOU think?” You’re sensitive to the ebb and flow in their moods, you know when they’re discouraged or frustrated. You get frustrated yourself, but you express it to them constructively. Above all, like any parent, you want them to be happy. Ok, AND successful. Because I’m an Asian parent.

Walter Chen (@smalter), CEO and co-founder of iDoneThis I wish I knew how important accurate metrics would become and that we could more easily support our reporting needs by preparing on day one. Over the last two years I’ve heard time and time again “we can’t track that easily because our app [ insert issue here ]. Had we decided early on what key metrics we would need to track and built the app to support our needs, we would have likely saved ourselves a world of pain.

Rick Perreault (@rickperreault), Co-founder and CEO of Unbounce The first company I started, a social shopping application, was a complete disaster. We built out what we thought was an awesome tool, but nobody wanted it. We wasted about $20k and about 1.5 years. From that experience, I realized that as much as there is a shortage of tech talent, the hard part isn’t the technology – it’s getting user demand.

If I were to have done things differently, I would’ve tested the market with little hacks before building out a product. I would’ve created landing pages to capture contact information of potential users and would’ve talked with them beforehand. I would’ve generated fake buttons that led nowhere or to a "coming soon” message to measure demand. In short, I wish I’d known to build as little as possible to test the market before building a product.

Elizabeth Yin (@launchbit), CEO and co-founder of LaunchBit

Are you a startup founder? Is there any advice you’d like to provide? If yes, leave a comment so we can discuss.

Why Stealth Startups Are Completely Overrated

Thu, 18 Oct 2012 10:29:46 -0700

There’s a phenomena in the startup world where startups think it’s in their best interest to operate in “stealth mode.” They believe that by doing so, they’ll get a leg up on the competition because people won’t be able to copy what they’re doing, but here’s what it really is – it’s a complete waste of everyone’s time.

Here’s the thing: if your idea is so easy to steal that you have to hide it, then it’s not that good of an idea to begin with. Stealth startups really don’t mean anything, and they don’t generate any hype. On the contrary, instead of gaining an advantage over the competition, it actually puts you behind because you don’t get feedback on your project. I’d much rather tell everyone what I’m doing so they can provide help and feedback, than I would to operate in stealth mode.

What follows are three common reasons people give for staying in stealth mode and an argument against each. Below that is an explanation of why Facebook is not a good example of a reason to stay in stealth mode.

Reason #1: People will steal your idea.

The thought that people will steal your idea and put you out of business if you talk about it is bogus. Why? Because there are likely multiple people who have or are working on your exact idea right now. You can keep it a secret, but if you’re idea is really that good, there’s a great chance that someone else is already working on it.

Not only so, but the people who are most likely to steal your idea are too busy working on their own projects anyway. In the end, the feedback you can get by talking about an idea is greater than the benefit of keeping it secret.

And besides, I’m pretty sure more ideas fail because they never see the light of day while being kept a secret than get stolen because people talk about them. Do you really think that not talking about your idea with friends, family, potential customers, and possible investors is going to guarantee your success, or is it more likely that keeping it a secret will guarantee that it never gets off the ground? My money is on the second option (but this doesn’t mean that you can’t be smart with how you talk about it by making sure you don’t ever share your secret sauce.)

Reason #2: The idea is what separates you from the competition.

Stop kidding yourself. If your idea is so awesome, people are going to copy it at some point if they aren’t already working on it now. Once you prove a product-market fit and show that there’s money to be made, there will be competition no matter how stealthy you are. If you’re worried about competition and you’re idea is the only thing separating you from them, then it’s not a good business idea in the first place. Great businesses run on more than just a good idea.

To prove the point, let’s talk about Facebook. They started first at Harvard, spread out campus to campus from there, and the first couple of years, users had to use .edu e-mail addresses to gain access. The competition had plenty of time to create a knockoff Facebook and compete. Why didn’t any big companies like Google or Microsoft create something for non-.edu users to take advantage of that market? Why didn’t competitors spring up left and right?

The difference is execution. What set Facebook apart is not necessarily the idea or any kind of patentable intellectual property but how well they built the product and grew it. By starting small and growing larger, they gained traction with a limited user based and then expanded from there. In the end, the success was from the execution, not stealth. They out-executed the competition and grew so fast that people couldn’t catch up.

That’s one side. The other side is that someone did have a similar idea – the folks at LinkedIn. They created a “Facebook” for professionals, the complete opposite of a network for .edus. Oh no! Facebook has competition! Not at all. There’s always room for more than one company. If a market is big enough, there’s room for more than one business. For every McDonald’s, there’s a Wendy’s, and for every Facebook, there’s a LinkedIn. If the only thing that separates you from competition is a unique idea, then you have a long road ahead of you (or really short depending how you look at it).

Reason #3: You want to benefit from first-mover advantage.

Let me be as clear as I can: first-mover advantage is not that big of a deal. If there’s a market for your product or service, then it just means that you’re the first in a line of businesses that will compete in the space. If there’s not a big enough market for the product or service, then it means that you’ve created a business that can’t be sustained. Either way, first-mover advantage doesn’t guarantee your success.

Every great business that proves a market at one point or another will face competition. At that point, you’ll need to compete on something other than the idea, and your competition will benefit from the successes and failures you’ve learned along the way. So being the first to move isn’t always the advantage it seems cut out to be because you might be the first to move into a market that isn’t sustainable or you might just learn lessons that your competition benefits from later. Eventually, if there’s money to be made, competitors will sprout up.

And it’s ok if they do. Why? Because most markets can sustain more than one business. Kia, Hyundai, and Sketchers didn’t move first. Instead, they moved way late, but they were able to push themselves into the market through good marketing and smart product development and pricing. Being first to a market isn’t the only way to be successful.

Here’s an article from the Harvard Business Review that talks about this in more detail – The Half-Truth of First Mover Advantage – and a Wikipedia article that talks about the benefits of second-mover advantage.

Facebook Case Study: The Winklevoss Twins vs. Mark Zuckerberg

At this point, you probably have a question about Facebook. You want to know more about what happened to the Winklevoss twins. Didn’t they get their idea stolen? The answer is yes…and no…

Yes, they had their idea stolen by Mark Zuckerberg. They hired him to build a social network, and Mr. Zuckerberg turned it into Facebook and ran with it on his own. That much lives on as social-media-entrepreneurial lore.

But the Winklevoss twins did win a settlement worth at least $65 million by proving that they were at least partially responsible with coming up with the original idea. Yes, that’s paltry compared to the billions that Zuckerberg is worth, but it’s also enough to position them as angel investors and entrepreneurs.

And here’s the kicker: Facebook may have never gotten off of the ground if they hadn’t talked about it. Yes, the idea ultimately was hijacked and developed by someone else, but it’s entirely possible that if they hadn’t hired Mark that the idea wouldn’t have gone anywhere. What if they kept it to themselves because they didn’t want anyone to know about it? What if the site was never developed? Instead of ending up with a $65 settlement, they’d be left with nothing.

Ok, yes, this is speculation, but it’s also possible. Another point is that this story is more the exception than the rule. More companies don’t launch successfully because they stay in stealth mode and don’t get feedback to grow quickly than because the idea gets stolen. If you’re not willing to talk to people about what you’re doing and to get the word out, then you’re not going to get the feedback you need when you need it. The result will be a startup that looks great on paper but never gets the wings it needs to take off.

All I can say is that more often than not, the majority of startups operating in stealth mode waste everyone’s time in an attempt to generate hype. Instead of creating an awesome product that solves a real problem, they run around hiding behind a stealth-mode cloak that really means they don’t have a legitimate business or business model to begin with. They’re busy creating the next big Facebook-sharing-social-media-thingy behind closed doors, when really, they don’t have a realistic business worth talking about at all.

So the choice is yours. You can stay in “stealth mode” and not tell anyone about your idea for fear that it will get stolen. That’s fine. But don’t be surprised when six months to a year from now your business hasn’t grown as fast as it could have if you went out and told more people about it. Remember this: the feedback you can get from talking about your idea and iterating your product in order to grow quickly has a far greater value than staying in stealth mode and releasing the “perfect” product two years down the road. That’s what I think anyway.

How about you? What do you think? Leave a comment and let’s talk.

The Ultimate Guide to Finding the Right Co-Founders

Thu, 27 Sep 2012 05:04:16 -0700

One of the top questions entrepreneurs ask is about how to find right co-founder. Business people are looking for technical partners, and programmers are looking for business people.

So how do you go about this process, and how do you know who to pick? The following guide will walk you through why finding the right co-founder makes a big difference and what you need to do to find the right one(s).

Why it matters
The first thing you have to realize is that your founding team matters. A lot. The right co-founders at the right time can be the difference between success and failure. This post on VentureHacks outlines why it’s important to pick the right co-founders and some strategies for doing so such as waiting to name a co-founder until the last possible responsible moment and bringing people on board first and then upgrading to co-founder status when they prove themselves.
The Post: When to Fire Your Co-Founders
Site: VentureHacks

Finding the perfect match
In this article, Christiana Wallace describes her experience of finding a co-founder for her startup Quincy, which offers a new approach to work apparel for ambitious women. She compares choosing a co-founder to finding a spouse and explains why it’s important to get to know potential co-founders first and even to test out the relationship.
The Post: The Perfect Match: Finding the Right Co-Founder
Site: Forbes

How to go about it
This VentureHacks post explains why it’s so important to choose the right co-founder and then gets into the details about how to do so. It begins by saying: “Picking a co-founder is your most important decision. It’s more important than your product, market, and investors.” That says a lot about how invaluable this step is in the startup process, and the remainder of the post explains the best way to go about finding a co-founder, including arguments for two being the ideal number and going into business with someone you already know.
The Post: How to Pick a Co-Founder
Site: Venture Hacks

Considering the details
In this article for the Harvard Business Review, Michael Fertik talks about the many details to consider when searching for a co-founder. He discusses everything from complimentary personalities and differing skills to a history of working together and having the same overall vision. This is an in-depth guide that provides several key points to consider when searching for a co-founder.
The Post: How to Pick a Co-Founder
Site: Harvard Business Review Blog Network

5 simple yet valuable tips
Interested in some simple yet extremely valuable advice on finding a co-founder? Look no further. In this post for VentureBeat, Mike McDermott, CEO and co-founder of Freshbooks, provides five simple but important tips for selecting the right co-founder: passion, trust, more than money, complementary skills, and giving equity. It’s a short post, but it’s invaluable coming from someone who’s started a very successful tech startup.
The Post: 5 Tips for Choosing a Co-Founder
Site: VentureBeat

The complete beginner’s guide
Neil Patel provides in this post the complete beginner’s guide for finding a co-founder. He begins by discussing the reasons to find a co-founder: extra manpower, dividing up responsibilities, increased motivation, more ideas, and extended networking; and then presents that two founders is the ideal number since three or four puts too many cooks in the kitchen and slows decision making. He also talks about getting to know a potential partner first without committing and recommends waiting at least six months before partnering with someone. You need to read the post to find out what else is discussed.
The Post: Beginner’s Guide to Finding the Right Business Partner
Site: Quick Sprout

The importance of diverse backgrounds
This post on TechCrunch is by Seth Sternberg, CEO of Meebo. It begins by talking about how important it is for co-founders to come from different backgrounds, outlining that most people hang out with like-minded people of similar backgrounds which doesn’t help with finding co-founders possessing diverse experiences and skills. He goes on to talk about how to accomplish this with tips for people who are in school and out of school. The post is full of practical advice about how to actually meet other people with complementary skill sets who are potential co-founder candidates.
The Post: Finding Your Co-Founders
Site: Tech Crunch

How to find a technical co-founder
Now that you know it’s critical for co-founders to come from diverse backgrounds, here’s an article about how to find a technical co-founder. It’s told from the perspective of an engineer about why he bought into the pre-launch product of his eventual business partner and CEO. You’ll learn a lot in this post about the mindset of technical co-founders and what they’re looking for on the business side. It also provides a list of the following resources on the topic: Why You Can(‘t) Recruit a Technical Co-Founder; Quora: Where Is the Best Place to Find a Rockstar Developer; Some Thoughts on Hiring Technical Co-Founders; and Please, Please, Please Stop Asking How to Find a Technical Co-Founder.
The Post: How to Hire a Technical Co-Founder
Title: StartupNorth

Finding a business co-founder
For those who are on the other side of the table and are looking for a business co-founder, this article discusses what to look for. It recommends starting with someone who has a good level of technical understanding but can also communicate well and has a good grasp of other non-technical areas like PR, operational details, talking with investors, a clear understanding of user feedback, a good eye for talent, and more. This is a must read if you’re in the position of looking for a non-technical, business co-founder.
The Post: What to Look for in a Business Co-Founder
Site: JeanlBaptiste

More advice for finding a business co-founder
This post points out that, even though technical co-founders are in high demand from non-technical founders, there still are programmers who are struggling to find the right business co-founder. This post provides tips to help programmers evaluate potential business partners with more criteria than an MBA alone.
The Post: How to Find a Business Co-Founder That Doesn’t Suck
Site: humbledMBA

What makes the perfect pair
Micah Baldwin, CEO of Graphic.ly, makes an argument in this post about what makes the perfect pair of co-founders: the Hacker and the Hustler. He goes on to explain that a hacker is more than a developer. It’s someone who solves problems in unique and special ways, but isn’t necessarily the best coder. The hustler, on the other hand, is someone who builds relationships and is more than a salesperson. He describes a hustler as “patient zero in a viral marketing campaign.” Read this article to learn more about Micah’s view on the perfect pair of co-founders.
The post: Hackers and Hustlers
Site: Learn to Duck

Where to find a co-founder
Finding a co-founder, whether technical or not, starts with looking in the right places. This article lists 16 different online and offline resources that can be used to find prospective co-founders. The list is comprehensive and useful.
The Post: Where to Find a Co-Founder
Site: Find the Tech Guy

Why founder vesting is a really good idea
Most entrepreneurs when they start out probably don’t give this much thought. They bring a handful of co-founders on board because they need some extra hands on deck, but they don’t know anything about vesting. Later on they hire employees and include 4 year vesting. The problem? Sometimes, early co-founders who barely worked at the startup end up owning a significant part of the company. You can avoid this by practicing founder vesting which is the same as requiring vesting for employee hires. This is a must read if founder vesting is new to you.
The post: Founder Vesting
Site: Chris Dixon

The argument for a single founder
What’s an ultimate guide to finding co-founders without an argument or two for a single-founder model? Yes, a lot of people believe in the merits of founding teams with complementary skills, but there are some benefits to starting a business solo. Actually, the highest number of businesses in the US are single-founder businesses totalling 20 million. This article discusses why. It also references this article for further reading: The Royal We: Single Founder Startups.
The post: Going Alone: Thoughts on the Single Person Startup
Site: ReadWriteWeb

Another argument for a single founder
Mark Suster continues the discussion about single founders in this post on the co-founder mythology. He says that 50/50 partnerships are unstable, people change, and partnerships often end badly. His advice is to take the leap solo and then to bring talented team members on at less than 50% equity. If you consider starting alone as borderline heretical, you’ve got to read this post. It presents an excellent argument for considering a single-founder startup.
The Post: The Co-Founder Mythology
Site: Both Sides of the Table

Now that you’ve read this post, what would you add to the list? Leave a comment to share more resources and links.

Unique Ways to Stand Out When Applying to Startups

Tue, 18 Sep 2012 14:01:12 -0700

As a founder of five startups, I’ve seen thousands of resumes and interviewed hundreds of applicants in search of talented employees. It’s caused me to realize that it’s not always easy for businesses to find the employees they’re looking to hire or for job seekers to stand out in the application process.

Some jobs receive thousands of applications, especially with the economy the way it is. How are job seekers supposed to stand out in a crowded field like that? It’s hard, but it can be done.

And that’s what interests me about unique job applications and resumes. Below is a list of unique ways applicants have used more than a standard resume to stand out and get hired, including some for companies I’ve founded. An important point to keep in mind is that the best creative applications are ones that demonstrate useful skills for the job being advertised. You also don’t want to go overboard and end up looking silly. Keep reading and I think you’ll understand.

#1: Create a Video Resume
At Grasshopper, we’ve had applicants submit video cover letters when everyone else submitted print versions. These videos didn’t guarantee the applicant would get hired, but they did guarantee they stood out.

Even if you don’t go crazy creative with the video, your cover letter will be more memorable than a standard print version. Just make sure you don’t go overboard with creativity (or a lack of good judgement) and stand out for the wrong reasons.

Here’s an example of an excellent digital resume where the applicant demonstrates his qualifications for a PR position through a catchy but professional video resume:

Just remember to make sure your video doesn’t end up coming off like this:

#2: Do Something Unique with the Company’s Product or Service
One way to stand out is to do something unique that integrates with the hiring company’s product or service.

When applying to Shopify, a guy named Mike Freeman decided to open up a Shopify store about himself to demonstrate his skills and experience. The hiring managers liked it so much that he ended up getting the job. Here’s what the marketing manager had to say about the application:

“He built an online store using Shopify where you can read about his background, experience, etc. and the ecommerce part is you can ‘buy’ an interview with him for ’$0.00,’ “ said Mark Hayes, Shopify’s manager of marketing and media. "We get an infinite amount of resumes here. Yes, he got the job.”

#3: Demonstrate Your Skills
Another way to stand out is to demonstrate skills for the job being applied for.

At Grasshopper, we’ve had a developer who created a website with the company name and why he was perfect for our company. He made the site dynamic to show off his coding skills. The site also demonstrated how interested he was in the position which is always important to us and other hiring managers.

Another way is to create a plugin or integration with a product from the company or contribute to an open source project. Both of these demonstrate skills and get your name in front of the company’s managers.

#4: Suggest an Improvement
Another way is to suggest an improvement for a product or service.

Instead of just showing up for an interview with the same information everyone else has, you could come armed with a suggestion about how you would improve something the company is currently doing. For a marketing position, this could be an SEO tweak to increase search engine traffic. An applicant could also write a blog post that would demonstrate writing skills that will generate traffic and social sharing.

Providing a suggestion shows you’re ready to contribute to the company from day one and not an inexperienced candidate that will need a lot of training.

#5: Conduct a Reverse Job Application
This may sound crazy, but it’s something that worked for a guy named Andrew Horner.

Two years after being out of college, he was still jobless and searching for employment. Frustrated with his lack of success even though he sent out hundreds of resumes and personalized cover letters, he decided to turn the tables. Instead of applying for jobs, he would have companies apply for his skills, and he set up this site: www.reversejobapplication.com.

Some people thought he was crazy, others thought he was arrogant, but in the end, he received and accepted a job offer from a startup after two weeks of interviews. That’s two years compared to two weeks. It’s bold, but it worked.

Not that this would work for everyone, but the site demonstrated Andrew’s creativity and also encouraged companies to reach out to him. In addition, it showed his personality, his writing skills, and his resourcefulness which ultimately led to a company that thought he was a good fit for their organization.

Here’s a snapshot of his site:

#6: Design an Infographic Resume
Last but not least, you can design a personal infographic resume that shows off your qualifications and stands out more than a common bullet-pointed resume.

A designer named Hagan Blount has generated publicity for her infographic-style resume as well as the ones she’s designed for other people. They’re bold, attention-grabbing, and eye-pleasing. One thing’s for sure: it’s guaranteed that resumes like this won’t be lost in the shuffle of homogeneous black and white resumes that look exactly the same.

As you can see, a little creativity and ingenuity can go a long way in standing out in the job market and landing a position at the startup of your dreams.

Sources:

How to build a Tivo alternative for under $700

Mon, 20 Feb 2012 15:15:13 -0800

Anyone that knows me will tell you I like messing around with AV equipment but I don’t really know what I am doing. I have setup and used many different systems including a whole home system from Russound with intercoms, Sonos, HDMI over Ethernet, iRule for making iPhones into universal remotes and much more. For the past 3 years I have stayed away from using cable company provided hardware by utilizing a CableCard and Moxi boxes and while not perfect it was a great option out of the box and something I recommended to many. Moxi worked a lot like Tivo but had no subscription fees and could play media from my media server where all movies are in MKV format.

Last week I went to purchase another Moxi and Moxi mate and found out they are not longer selling the device and might even stop supporting TV lineup data in the near future. This was disappointing and even more so when I found there are no good alternatives. After much research the only out of the box solution I found is Tivo and of course requires you to pay a monthly subscription or one-time fee for a lifetime access for that purchase. I was about 15 minutes away from purchasing a Tivo when I thought, let’s see if I can build this.

Here is how I built a system for under $700 that replaces a Tivo Premiere Elite ($499) and monthly service of $19.99 or $499 for lifetime. There are a few missing features and I have not run this long so I can say how perfect it is but it works and I can control it. Disclaimer, this is not a great option for anyone not familiar with computers and networking as there will be problems you have to fix.

Starting with a very small computer to power the HDMI signal and Microsoft Windows Media Center I purchased an EeeBox PC EB1501P from Amazon for $431.99 including shipping cause I have Amazon Prime. I looked at a number of small form factor PCs and really like this as it included the Windows 7 license I needed, had a DVD drive and good graphics to power HDMI signal to a Samsung 55 inch TV. Setup was very easy, ran all the system updates, removed all other installed software that was not needed and configured Windows Media Center. As a Mac user I tried very hard to see how this could be done on Mac and it could if you ran Windows but it would double the price if not more.
Time: 2 hours / Cost: $432

Next I needed something to handle the CableCard as I wanted more than standard digital cable. I found tons of options that could take digital cable and make it a stream for Windows Media Center but not many options for CableCard access. Came down to InfiniTV 4 USB from Ceton and HDHomeRun Prime. I decided on the HDHomeRun Prime for $209.99 from Amazon, as it was an external device that would offload the processing of the media compared with a USB device that used the same PC as the media center. The downside of this is the media has to stream over the network and wireless is not an option for HD. Maybe I will test the Ceton device later.
Time: 1 hour / Cost: $210

The final part was a controller and I did not find many options that were made for Windows Media Center and also did IR. I also found that there was a remote that came with the EeeBox PC but does not seem to work well when the PC is in a cabinet. I went with what was available on Amazon for $28.89. It would be nice to add some Media Extenders to this setup in the near future but it seems that all but the Xbox 360 have been discontinued by manufacturers.

So far things are working well, Windows Media Center has lost the connection with HDHomeRun Prime a few times but I am not sure if that is a network issue or an issue with the device. Maybe this would be corrected with using the Ceton device. I am very impressed with Windows Media Center and all the functions it has as well as how the interface looks. Would not expect this from Microsoft, maybe they should focus on this more and less on things they are not good at.

Here is my final setup with the EeeBox, HDHomeRun Prime and Motorola cable modem that also does Wi-Fi, again no reason to rent a modem from the cable provider.

Total Time: 3 hours and Cost: $671

Timely is great for Twitter engagement except when you run a marathon

Tue, 10 May 2011 07:24:15 -0700

My friends Dan and Ethan over at Flowtown created Timely, a great application for posting messages to Twitter at the time you will get the most engagement from your followers and I started using it a few months ago. Truthfully when I first saw the application I did not care about the scheduling part based around engagement, I just wanted a place to keep tweets and links that I wanted to share at some point.

Previous to using Timely I used a note in Outlook where I would store tweets to things I found interesting and as I remembered each day at some random point I would tweet out this interesting tidbit. That worked fine other than the days I forgot to do it.

While Timely has all sorts of cool features and even more if you want to pay, which at this point I do not pay for the application, I just use it as a replacement for my notepad in Outlook. This use case works perfectly other than the day you run a marathon and in the middle of your run there is a tweet that goes out, so for a few days after that I got asked if I stopped on the course to send out that tweet.

I am still not sure if my Twitter engagement has gone up because of using Timely, right now I sort of feel like it might have gone down a little since the posts are clearly automated if you are look at the app that posted them. Either way I like using Timely as it replaced a crappy method of keeping track of things I found interesting and wanted to share.

Three lessons learned at Starwood Hotels, one social media and two business

Mon, 10 Jan 2011 14:22:00 -0800

I really love Starwood Hotels and I’ve stayed at many of their properties around the world, and enjoyed the benefits of the Starwood Preferred Guest Program. Having spent many nights with them, I was expecting a good experience when we decided to stay local for the Grasshopper yearly off-site planning session, and visit the Le Meridien property in Cambridge, MA.

Even if you pay for 24 nights and a conference room, the hotel’s “free WiFi” is going to cost you

In addition to paying for food, beverages and eight hotel rooms for three nights, we rented a conference room for our sessions. When we arrived early in the morning, I wasn’t expecting my room to be ready (and it was not) so I went right to the 3rd floor where our meetings would be held for the duration of our stay. After I grabbed a bottle of water and something to eat, a few others from the Grasshopper team joined me and we started getting ready to settle in with our laptops. Just as we did so, we discovered that the “free WiFi” that was available in all of the guest rooms and the lobby was blocked. Easy fix right? Wrong.

When we asked the conference manager if we could have the password to access the internet in the conference room, he came by a few minutes later and casually asked if we could sign something. Upon further inspection, that “something” was an agreement to pay $250/day for internet. That’s right: After paying for eight hotel rooms for three nights, for a total of 24 nights at an otherwise empty hotel (with free internet in the rooms) we were being asked to pay for using the internet in the conference room. I gave the hotel the benefit of the doubt and spoke with the hotel manager who referred me to the events and catering manager.

Making excuses never makes a customer feel better

After getting passed off to the events and catering manager, and listening to her many excuses as to why the $250/day price tag for WiFi was justified, and how she couldn’t do anything about it for us, she then told me, “All of the other hotels in this area charge the same or more and we call them every month to verify our pricing is fair.” I was at a loss for words. Looking past all of the problems–that the hotel manager did not care, could not help and just passed blame—I couldn’t believe that the events manager even admitted it was an actual policy to charge this access fee. Worst of all, she actually admitted spending time each month “calling other hotels” to “verify” their pricing!

So, what lessons did this experience reinforce? Here they are:

Lesson #1: Just because your competitors do something does not make it right.

If your competitors apply a ridiculous fee for conference room WiFi, you’re getting an opportunity to be different, so stand out and do the right thing. Don’t do what Starwood did and justify fees by saying that they make you “just like everybody else.” Instead, use the opportunity to differentiate yourself; offer a substantially lower price to use the internet in the conference rooms, or better yet, make it free, just like all of the WiFi in the hotel rooms!

Once giving the hotel and the management a chance to make things right, I turned to Twitter and voiced my frustration with these two tweets to test the Starwood Hotels social media team.

The social media team did respond and ultimately sent me an email and tried to work with the hotel. After explaining my issue, the person from their social media team called the hotel and spoke to “management”—probably the same staff members with whom I’d spoken initially. After all of this, here was the email I got from the social media representative on Twitter:

“Our role is to act as mediators between our properties and our guests, so that we can bring our guests concerns to the hotel level and encourage them to provide the highest level of service possible. Your concern that the hotel charges an exorbitant amount for meeting room internet, while offering the same amenity free of charge for guests in their rooms, is valid.”

Perfect setup for bad news, and the bad news was to come…

“I have spoken with Andrea, the Front Office Manager at the hotel, and explained your concerns. I mentioned that we appreciated the way in which you contacted us online without immediately blasting the hotel, the reasonable nature of your concerns, as well as the potential impact of a negative resolution. She did consult the hotel sales team regarding your comments, and the hotel has made their decision. In the end, their prices are competitive within the region, they will maintain the stance that their charges for meeting room internet use are justified.”

Lesson #2: Having a social media team is useless when they have no power to fix things. Just give them the ability to give $500 courtesy credit at minimum.

I totally appreciate that the social media team tried to make this situation right, and that the hotel had the final say, but the experience did point out some great lessons for any business or entrepreneur trying to understand how social media can help their brand.

If you’re going to go social, make it a serious component of your business, not simply a front that is completely disempowered to make any decisions. What’s the point of interacting with your customers on Twitter if in the end you can’t do anything for them? Make sure that your social efforts match up with those of your business—otherwise, social media won’t do anything for you. People will see right through it.

Lesson #3: Ask a frustrated customer what would make them happy, and you’ll make them a brand evangelist.

The hotel never asked me what would make me a happy customer (all I wanted was free internet, like in the lobby and hotel rooms). Worst of all, everyone I dealt with at Le Meridien in Cambridge seemed totally disinterested in helping me or making their hotel stand out among a sea of options in the Boston area. If they’d just taken the time to find out what would resolve the situation quickly and efficiently, I wouldn’t be writing this post. They also had other options: could have given a $50 discount, given the next day’s internet for free, maybe even tossed some free meals our way, almost anything to show they at least listened.

Final thoughts

So, it’s pretty clear I won’t be raving about the experience I had at Starwood’s Le Meridien property anytime soon, but these are still some excellent (and very basic) lessons for entrepreneurs about creating brand loyalty and respecting your customer. If nothing else, we can take this bad experience and turn it into an enlightening one.

Who will you French kiss this New Years?

Wed, 29 Dec 2010 18:09:31 -0800

Everyone knows that the week after Christmas (and before the new year) is pretty slow; at Grasshopper alone, I think at least half of our office is on vacation. Certainly a good time for a break, but if you’re like the folks at Moosejaw, it’s also a great time to experiment with some fun (and slightly bizarre) marketing. Case in point is the online retailer’s promotional email sent out today, cleverly titled, “New Year’s Eve Frenching Service.”

Frenching service?! Right away I’m interested, since this is not the typical “10% off today only!” email. Why would a retailer who sells The North Face and skiing gear send this out? Curiosity piqued, I open the email and find this:

So, what is this? This is a stellar example of the kind of creative marketing that everyone is looking for, and can’t figure out. Even though the email had nothing to do with the products they sell, here’s why it worked:

Amazing copywriting that grabs you. Groupon’s got over 100 writers. Why? Because they understand that they key to hooking people is with great, lively copy. Moosejaw’s email succeeds because the writing is hilarious, engaging, and completely irreverent. Most brands fail at emails like this because they play it safe with stiff, formal copy. Don’t. If you want to get noticed, include copy that grabs a reader’s attention.
Timely messaging. This fun “promotion” would only work at New Year’s or Valentine’s Day so the timing was perfect. Even better that this is a historically “slow” week for email, so I might actually read an email from an online retailer versus sending it to the trash.
Brand personality. Anyone can send an email with a deal, but this email is actually in line with the Moosejaw brand (which, if you know anything about their brand, is a little quirky, definitely different, yet still polished). When you get a box from Moosejaw, it is most likely reused (not recycled), the wrong size, and has lots of stickers on it. These people understand how to make their individuality work for them, and they attract customers who appreciate that level of quirkiness.
Trust in team members. I doubt this came from some marketing genius at Moosejaw, but instead, a team member that had a fun idea and was allowed to run with it. In a typical company you could never send an email like that to your valuable mailing list, but at Moosejaw, you can do it. Guess what? It works—after all, here I am writing this blog post about Moosejaw.com.

This is creative email marketing done right. Nice job, Moosejaw.

Observations While in a Virgin Lounge for 8 Hours

Tue, 16 Nov 2010 05:53:50 -0800

Sitting in the Virgin Atlantic London Heathrow lounge for more than 8 hours today gave me a chance to see the operation from busy to slow, and then back to busy again. While waiting to depart for South Africa, I was lucky enough to enjoy some food, a quick rest and an entire movie on my laptop. Here are a few observations about the Virgin Lounge, created by a company I love.

All about the experience. As a flagship location for Virgin, the London Heathrow lounge is pretty big, but from the minute you enter it’s all about the experience. Case in point? Two greeters (not behind an impersonal window) welcome you, then you step inside to an entirely different universe. Fun, modern design, plenty to eat for free, friendly staff and the unmistakable “kid in a candy shop” mentality make it easier to forget you’re in an airport. Don’t want to talk to anyone? Make your own snacks and just kick back.

Branding without logos. In the Virgin Lounge, everything is branded: the color of the LED lights in the ceiling, the leather couches, the menus and even the table numbers. Everywhere you look it just oozes Virgin Atlantic without having a single logo anywhere. But how do they do that? By selecting a “look and feel” and letting that carry over into every dimension of their brand both in the air (just look at the seats, the flight attendants’ uniforms, and the bar area) and on the ground inside of the lounge. It may be James Bond meets Austin Powers, and a little off-beat, but they don’t do anything half-way, which results in an extremely memorable brand that doesn’t rely on a logo as its only means of identifying itself.

Give the feeling of “free.” Inside of the Virgin Lounge, everything is “free,” from the martinis you order while you wait to the upscale deli where they’ll make you a sandwich exactly how you want it. Need internet access? That’s free, too. How about a service from the on-site spa? Yup, one service per visitor is free as well. With all of these amazing amenities, it’s fun watching Virgin Lounge newbies’ faces; they’ll look at the menu (which has no prices but also does not say it is free) and then ask a server just for confirmation that everything before them is in fact, free of charge. At the Virgin Lounge, they make you feel like a rock star, even though, who are we kidding though, none of this is free since you’ve paid (or used American Express points like I did) for an Upper Class ticket. Somehow, though, it doesn’t matter—by purchasing a ticket, Virgin makes you feel like you’ve purchased a lifestyle.

Hidden process improvements. When you sit back and think about it, it makes a lot of sense to serve full dinners to passengers in a lounge where you have staff and a kitchen compared with on a plane. I am sure it saves on food costs, makes the staff on the plan happier and the best bonus of all:it feels exclusive to the customer.

Double duty. Spending so much time in the lounge, you get to see all the uses of it and it is for more than just passengers. There were a number of Virgin staff having meetings, talking with clients, and making use of the space. I might have expected to see flight staff, but there were none, however a group of at least ten staff had a meeting for an hour upstairs. Greatway to use the space you already have.

Turn a cost center into revenue. For a number of years, Virgin has offered the Bumble and Bumble salon at the lounge and even on planes at one point I think and it use to be all free with the limit of one service. Now you can get as many services as you want, but the first one is free and there are upgrades to all the free services. Nothing is too expensive but what a great way to turn a cost center into a revenue center; I have no idea if it’s profitable or not, but same staff and resources are generating some revenue now.

It was a very pleasant day in the lounge and I am sure I will visit again, just hoping some day (though doubtful) I will run in to Sir Richard Branson here.