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Track your expenses the Buxfer way !! November 19, 2006

Posted by rajAT in buxfer, startup, venture capital, web2.0.
14 comments

Last week I had a chat with Amit Manjhi the guy behind payments website called Buxfer.com. Other 2 co-founders are Ashwin and Shashank. All 3 are doing their phd at Carnegie Mellon.

Amit told me that Buxfer started more from the their own need. It was difficult keeping track of the group expenses. So the more enterprising guy Ashwin created a script to track their money. It was really useful and loads of people asked them to share it with them also. That is when they saw the apple falling created Buxfer.

We started talking about the various other things and quickly find out some common friends. So very Indian :D. Aur phir dilli ki baatein shuru ho gayi jo kabhi khatam na hon :D. It was real fun.

Its real nice to see people doing innovative things to make our lives simpler. Keep up the good work guys. 🙂

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Internet Highlights November 10, 2006

Posted by rajAT in internet, merry meeker.
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Users / Usage — Yahoo! has base of 418MM+ unique monthly visitors (+19% Y/Y with 24% Y/Y page view growth, CQ3)

Customer Acquisition — Google (500K – 1MM advertisers / vendors, and rising); 30%+ clicks (and rising) on sponsored links – effective targeting should continue to improve + drive rising monetization

Commerce / Payments — PayPal (123MM accounts, +41% Y/Y, CQ3) + Shopping.com has 40MM+ products in 325+ categories

Advertising — 8% of total US advertising online in 2006E growing to estimated 13%+ within 5 years – Google + Yahoo! = key drivers + beneficiaries

Significant targeting / conversion improvements (related to technology improvements + data leverage) — could bolster annual global revenue per unique user of $9 for Google (+42% Y/Y) and $10 for Yahoo! (+29% Y/Y) 2-3x in next 5 years

Personalization — Recommendation engines improve monetization – examples include Amazon.com + Yahoo! Music

Communications / Telephony — Skype (136MM registered users, +20% Q/Q, CQ3 — may be fastest growing product in history). Based on CQ1 data, Skype traffic = ~7% of global international long distance minutes. Global mobile data services revenue (ex. messaging) has $10 ARPU (and rising). If Skype were a carrier, global registered user level would rank it #3 behind China Mobile (274MM subscribers) and Vodafone (187MM). IM (instant messaging) + SMS / MMS showing strong growth

Video — ~60% of Internet traffic may be P2P file sharing of unmonetized video — ramp in tagging (for search) + partnerships + monetization – note recent moves by likes of ABC / CBS / FOX / NBA / Sony / Warner / Universal / Google / Yahoo!. Challenges (especially related to copyright and infrastructure stress) are significant, but over time, consumer demand should rule and content creators should benefit

Local — Google ‘Long Tail’ + eBay Classifieds (19MM+ unique visitors, +140% Y/Y, CQ2) – traction emerging

Community / Social Media — Likes of Wikipedia, MySpace, YouTube, Yahoo! Flickr + Yahoo! Answers have experienced extraordinary growth. CyWorld (Korea) + TenCent (China) monetizing. 57MM blogs – doubling every 7 months, per Technorati. 1B cameraenabled
mobiles within 1 year – ‘citizen journalism’ in infancy

Mobile — While 17% of global Internet users (32% in N. America) have residential broadband, 8% of global mobile phone subscribers use 3G. American Idol – 63MM votes (via mobiles + Internet) in final 4-hour round, China’s Super Girl – 12MM votes (primarily mobiles) in final 3- hour round. Mobile data services (bolstered by 2.5G & ex. messaging) revenue ~$20B, comparable to online advertising revenue — illustrates potential monetization opportunity for broadband Internet!

(Source Merry Meeker @ Morgan Stanley)

Future of Data Centres – Project Blackbox November 7, 2006

Posted by rajAT in blackbox, sun, virtualized data center.
4 comments

After today, you’ll never look at an ordinary shipping container quite the same way again. Project Blackbox is a prototype of the world’s first virtualized datacenter–built into a shipping container and optimized to deliver extreme energy, space, and performance efficiencies.

Increase datacenter capacity while utilizing undeveloped space

Housed in a standard 20-foot shipping container for easy transport using common shipping methods

You can see the whole video below –

As Tim Bray says its f**king cool, I totally agree.

Charles River Ventures – New Investment Strategy November 3, 2006

Posted by rajAT in entrepreneur, startup, vc, venture capital.
3 comments

I have blogged earlier here and here that present VC model is broken and it should be chnaged.

Charles River Ventures, an early stage venture capital firm, has launched a new investment strategy, offering rapid but tiny $250,000 checks to Internet start-ups.

The advantage of a seed round is that it done as a “convertible” loan, which means the $250,000 is essentially a no-strings-attached loan to an entrepreneur. There is no equity stake claim by the investor at the time, which is good for the entrepreneur, who can see how good his idea is first. If the idea gains traction, he can raise money in the series A and negotiate a high valuation for his company. If he can command a $5 million valuation, for example, the investor’s $250,000 seed money converts into only 5 percent of the company.

There is almost no liability for the entrepreneurs, because the loan is made to a corporation formed around the entrepreneur. If the company fails, the company goes away, and the founders aren’t liable.

From CRV’s site for an example:

If CRV loans your company $100,000 with a six percent interest rate, and six months later the company closed a Series A round, at that point the loan balance (with interest) would convert at a 25% discount (value = loan dollar amount plus interest / .75) into $137,333.33 worth of Series A stock. Given that seed funding amounts are typically very small compared to the amounts one might expect to raise in a Series A round, as the example illustrates, the aggregate discount amount, in this case $37K, is a tiny fraction of what is likely to be a multimillion dollar Series A financing.

Its good to see that VCs are trying to change their ways of working also. After all we entrepreneurs are their customers and they should keep us happy. 🙂

India Knowledge @ Wharton November 2, 2006

Posted by rajAT in india, isb, wharton.
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Knowledge @ Wharton has launched India Knowlege @ Wharton in assoication with ISB. It can be accessed at http://www.ikw.in.

The new site includes articles that focus on India’s increasing importance to the global economy. The first issue features interviews with Indian finance minister P. Chidambaram and Ronojoy Dutta, former CEO of Air Sahara, in addition to a look at Tata Steel’s Corus takeover and stories on Indian real estate and the country’s burgeoning BPO film industry.

Another small step towards the recognition of emerging India !!

YouTube – From Concept to Hypergrowth November 2, 2006

Posted by rajAT in jawed karim, startup, youtube.
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This is a 50 min. talk/presentation by Jawed Karim – one of the three YouTube co-founders – about how and why (social networking) sites like YouTube became so popular in the last couple of years. Although it focuses on the bigger known services this is very interesting to watch. Specially towards the end (last 10 min. or so) there is a lot to learn about why YouTube works/what made it work – recommended for anyone who has to do with social networking sites or wants to better understand them…

Building the right mobile app November 2, 2006

Posted by rajAT in india, mobile, startup.
1 comment so far

Well the title over promises. I am not going to dole out lot of gyan for building the right app for the mobile. Just narrating some experience that I had in Delhi. One of the mobile enthusiasts there asked me if I can give some feedback on their idea that he and his friend have been mulling over. I was delighted as he thought me worthy enough for the job. We met at PVR Saket. I bet not a great place to meet and discuss mobile VAS. There is so much girls around ‘Value getting created‘ and we are missing all the fun ‘Value not captured‘ :). The idea was interesting and guys have done some homework as in how to build the app. I was impressed at that. But then when I asked some of they important questions as in

a. What is the business model ?

b. How the value is getting created in the value chain ?

c. Are they capable to capture that value for themselves ?

d. What is the USP ?

And numerous others on the same lines. There were no clear answers for any of them. They were mixing the USP with other things and there were whole lot of other issues. Guys took it coolly. Meeting ended.

Today while browsing I found some more interesting tips by Sprint’s Vice President for Partner Development and Product Innovation Paul Reddick. Here they are –

1. Know thyself — consider your scope carefully and be specific of what you do that is better than everything out there.
2. Know if you are a mass market or a niche application — mass market is hard to get right, because it has to be popular to such a wide audience. But also if you’re a niche application don’t expect to be placed on the deck.
3. Educate objectively before selling passionately — carriers see a lot of ideas, don’t oversell it.
4. Admit what you’ve accomplished versus trying to sell what is really a work in progress.
5. Be specific about what you want from the carrier. And know what the carrier has deployed in the market — at CTIA he says he had a guy pitching him an application that they had launched three years ago.
6. Provide differentiation.
7. Adapt to new models — he gives the example of Sprint bundling applications with the handset, which he says is a risky move and a big shift for Sprint.
8. Leverage new capabilties — like WiMAX.
9. Avoid asking him why your application can’t be on the Sprint’s deck — he says he hears a sense of entitlement. Go off deck.
10. His team focuses on finding innovation that can fix technology and service bottlenecks. Keep that in mind.

But all salutes to the guys for their passion. I sincerely hope they might be either refining their plans or thinking on new lines.

All luck.

Tie Con Delhi 2006 November 1, 2006

Posted by rajAT in india, startup, tiecon delhi.
1 comment so far

Last weekend I was in Delhi attending TiE Con 2006. The event was action packed. Met lots of interesting people in the conference.

The best part of 2 day session was from Vivek Ranadive. I am reproducing here the post from my friend Nikhil. He invited me for a rock gig but I couldnt make it due to time constraints. So here is the post ..

The Keynote address on Day 2 at TiEcon 2006 was delivered by Vivek Ranadive, Chairman and Founder of TIBCO narrated his story in a wry self deprecating manner, and offered advise to entrepreneurs based on his own experiences. Giving his own example of enterprise, on how he persevered and eventually got some of his (according to him) ‘smarter’ friends to join his business after he received seed funding, his first offering bit of advise: surround yourself with people who are smarter than you. He began his company at a time when there was little funding, but he had an idea of a “software bus” that he wanted to implement. After receiving his funding, he talked his was into the Goldman Sachs office and convinced the newly appointed head to allow him to digitize wall street. He was among the first people to go down on to wall street and talk to the traders on how they actually worked and this helped them plan their implementation better. So – Listen to your customer and really understand how to help them. Forget about the competition, he reiterated – listen to the customer. He joked that Reuters had been a competitor for them, since because of thier digitization, the Reuters business at Wall Street was actually suffering. When Reuters bought TIBCO, he learnt that internally, people at Reuters had referred to TIB in TIBCO as ‘That Indian Bastard’. After Goldman Sachs, their next big deal was with Solomon Brothers who wanted to put the entire bond system on digital. IBM was among their competitors, and he was called for a lunch meeting where the CIO of Solomon Brothers asked him why they should do business with TIBCO? Ranadive repeatedly spoke about his product, his people and the company. When the CIO asked him again about why they should do business with him, Ranadive looked him straight in the eyes and said – “Because we have fire in our eyes”. That later became a joke at Solomon Brothers, but it is important to have passion, he said.

photo courtesy – http://www.amitranjan.com