Friday, October 26, 2007
At FirstRain we often get together on Fridays for happy hour, or lunch, or birthday cake - something to bring the California team together. (Note in New York it seems we meet in bars - hmmm... cultural difference there between engineering/finance and sales).
Thursday, October 25, 2007
The debate on Silicon Valley vs. New York for startups rages on. Today's post on Silicon Alley Insider "Quit Whining: How To Make An NYC Startup Work" says that lack of space, technical people, lawyers and funding is all bs.
My opinion is that startups are hard, really hard. I've been in one, run one through to an IPO and am now doing another one. They're fun but they are hard (did I say that already?). Being in silicon valley reduces the risk. You have access to more talent, more understanding landlords, more VCs and experienced venture lawyers. You have access to the entrepreneurial fever - to crazy technologists who'll work all night to crack a hard problem - to advisors who've done it before and can help you get through the dark nights when you think maybe your idea is never going to work.
When I took over FirstRain two and a half years ago I moved the company from Manhattan to Foster City. It was a deliberate decision and one I told the board I would do before I accepted the job. The personnel I moved were all engineering and product design, the rest I rehired. It was not an easy decision for my employees but it was the right decision to be able to get the level of talent in required to build a system of the technology depth that we need to use the web as a research base for institutional grade investors. I left the sales team in New York - after all that is where our customers are - and the only time I ever question my decision is about 3 hours into a red eye from SFO to JFK, which I do frequently. Otherwise I know it was the best decision for the company and for my engineers.
I just think that the risk in startups is high enough already. If you can get your idea to silicon valley you should. You should take every avenue you can to reduce risk so that the remaining risk is in your idea and your ability to execute.
Wednesday, October 24, 2007
One thing investors really like to see in FirstRain is stories signally a potential move in the price of a stock that do not make it into Bloomberg (ie. what most people are seeing).
Tuesday, October 16, 2007
It’s a question people ask me – and the thoughts that race through my mind are well captured in today’s WSJ article “If not for your kids, would you really be dancing in Rio?”. Worth reading and read on for a tool to help you think through what to do if the answer is no.
I took 2004 off after some health issues and then wanted to determine whether to go back to work or not, and if so what to do? The first – whether? – was easy. I was bored out of my brain staying home. I slept, redecorated the house, worked out, traveled extensively with my family and cleaned out every closet, but when my kids went back to school in September I knew I had to go back to work to stay sane. I confess I did not go dancing in Rio, but I did dance figuratively in London, Rome, Paris and New York, not to forget several Hawaiian islands.
So then to – what? I consulted, I worked for my non-profits, I spent time as an EIR at a leading VC firm to figure out if I’d like that world, and then I used a tool on myself which I have advised people to use in their own career planning.
It’s simple. Two columns. One with the activities I enjoy every day that I have experienced across different jobs. The second with the activities I do not enjoy. Note, it is activities not title, scope, pay etc. I figure it’s like buying a bed. You spend a third of your life in bed – it had better be comfortable. I spend well more than a third of my life working – it had better be challenging, joyful and rewarding at an emotional level.
When I looked at the positive side of the list the activities were mostly associated with building teams, markets and companies. Time spent with great people, time spent with customers solving problems, time spent executing creative market development strategies. Really fun stuff. On the negative side was time spent in b***sh** meetings with people I don’t respect, time spent doing busy work for non-useful corporate processes, or traveling frequently to countries I don’t particularly enjoy.
When I netted it out for me it meant being a CEO again of a growing company where I can set the agenda and build the team (hence my selection of FirstRain). For each person the result will be different but the process will be revealing.
The good news is most people enjoy their jobs. If they didn’t they’d move. The WSJ reports that while many are working to pay for their kid’s tuition, 90% of Americans are somewhat satisfied with their jobs and more encouragingly two thirds would take the same job again “without hesitation”. If you’re not in that two thirds – get a piece of paper, draw two columns…
Tuesday, October 9, 2007
Recently, Silicon Valley startup Powerset has made waves by promising to use natural language and sentence parsing to better search the web. They claim that by better understanding the intention of a user's question and the meaning of a document's content, the search results can be better matched to a user's need. So, they are betting that searchers will be willing to put (arguably) more effort into composing their search, to retrieve documents keyed exactly to their well formed English question.
First, this is not a new concept. Companies like Inquira and Kaidara have been applying language processing to the customer service problem for a number of years. They’ve developed technology allowing users (like you and me) who go on line needing help technical support to write in natural English to get to the answer from a natural language search of the repository of solutions they have.
While this is working somewhat well for customer service there are some hurdles to adoption for the consumer search market.
First, it is unclear whether we (the consumers) are willing to put more effort into searching to receive incrementally better results.
Second, how often are web users *really* trying to answer a question? We’re often not looking for a single answer, but we are instead trying to get a general sense of some topic or idea.
And third, if we are seeking something specific, the "phrase your query in the form of a question" restriction seems annoying. I just want a really simple way to indicate what I am looking for.
This is where web content discovery tools (vs. search tools) like ours and others really deliver. In many cases, users of advanced systems don't even know what they want. People have a (seemingly reasonable) expectation for technology to develop to get me more of what I want with less effort. Even better, we want to get what we didn't yet know we wanted with *no* effort.
This is what a good movie, or a book recommendation gives you - the huge benefit of tools like Amazon's recommendations and Netflix personalized ratings. In both cases users are delighted by a system which rewards very little effort with a personalized and serendipitous experience.
How often do you choose a Netflix movie based on search vs. how often do you go with their recommendations? I know their recommendations make me think and remind me of movies I’d forgotten I wanted to see – much like we prompt users to ask questions around their investments which they had not thought of, and generate new ideas for investments.
Companies like Powerset fill a need, and I hope they'll succeed at their stated goal, but they'll be solving a minor problem, leaving the grander, game changing discoveries still to come.
Monday, October 8, 2007
Cutting the ribbon (notice all the smiles!)
Decorated new office space
Traditional (beautiful) flower decorations
(writing from Denver airport after a perfect weekend in Boulder, CO with close friends - what a beautiful place to live)
Professor Jeffrey Pfeffer wrote a very insightful book more than 25 years ago called “Power in Organizations” – and has of course written numerous follow ups over the years.
His studies on power are essential reading for anyone wanting to understand how power is captured and consolidated in organizations and companies. In essence the lesson is as follows:
The ability to consolidate power comes from two sources – people who know WHAT to do, and people who know HOW to get it done. Most people have only one or the other of these skills. Power accumulates to people who have both. They know both what to do AND how to get it done.
Think about all the people you’ve worked with, especially in startups. There are the strategists, the dreamers who can see the possibilities but don’t know how to make it happen. There are the operations types who are very good at executing through projects, but don’t come up with the exciting new ideas, and then there are the few who do both. They know where to go and how to get there – and what’s magical about those type of people is that other people want to follow. We all want to be on a team that’s going to set a great goal and get to the goal. And so we give power to those people – politicians, CEOs, product managers, surgeons.
I read Pfeffer’s book very early in my career. I’d probably been out of college just a couple of years, and I took the message to heart and tried to ensure that I would get experience that would teach me both essential skills – the what and the how - plus I like to surround myself with executives who are natural leaders and know how to manage power for the good of the company.
Tuesday, October 2, 2007
I was delighted with an article in the Boston Globe “The New Me Generation” which spoke directly to some of the joys and the challenges I have managing FirstRain.
The essence of the article was summarized by the WSJ:
"The narcissism of the younger rising generation in the work force might be the shot in the arm corporate America needs, even if it is annoying. In the Boston Globe, Jake Halpern (born in 1975) declares anyone born after 1970 to be a member of the Entitlement Generation, marked by self-absorption, arrogance, a low regard for formal dress codes and a high regard for its own opinions. A nation-wide survey using a standardized test called the Narcissistic Personality Inventory found that 24% of college students in 2006 showed elevated levels of narcissism compared to just 15% in the early 1990s.
However, narcissists have some advantages. Their confidence allows them to take risks others might balk at. As more companies depend on innovation to stay a step ahead of globalization, the Entitlement Generation is well-equipped to be push through bold ideas onto skeptical elders. However, since narcissists also rarely acknowledge that their wrong ideas are wrong, the trick for elders “is to identify the upstarts with the most potential” and only then, “despite whatever personal qualms we may have with them – allow them to run with their ideas.”
FirstRain is a new generation company, without a doubt and we are dealing with bleeding edge technology to solve problems for a mature, seasoned customer base in a rapidly, radically changing market.
By far the majority of my employees were born after 1970 and I'd guess more than 60% were born after 1975. Particularly in the departments with the majority of the headcount: engineering and sales. And we do have a strong contingent particularly in sales (and front line sales support) who exhibit the characteristics described by the Boston Globe article: narcissist and self confident.
As a CEO though I love those characteristics, and I am self aware enough to know that some of it is because I see myself in them (even though I was born in 1960). I was raised in England, a daughter of the British Raj and sent away to boarding school at 12 (the girl’s equivalent of Eton). There I was molded to be very self confident – but for a completely different purpose. I was in a transition generation. Modeled after the most famous boy’s schools, the school had been designed in the late 19th century to create empire builders, while the British Empire was still global. In 1972 we were still being trained in the same way - to be young women full of confidence who could take on any challenge. And I was one of the extreme non-conformers of my generation through the school (a much longer story).
Having confidence in yourself, taking risks and challenging authority are essential skills for entrepreneurs, for innovation (which requires risk as I posted recently) and for employees of young, growing companies. The only caveat is that the challenging behavior needs to be constructive and not political. I simply won’t tolerate any behavior that puts the needs of the individual ahead of the needs of the company; it must be company first - but beyond that there are no rules.
I encourage and reward my team members who make change happen. I believe strongly in promoting from within and taking a chance on bright, hungry rainmakers who demonstrate they can lead, take risks and get to great results. They make the company sing.
In a sign of the times, I found this mention of Intel inviting influential bloggers to its press events in China. This is another data point on what we see: that corporate marketing and some money managers (especially in Tech) are beginning to look at blogs as a rich thought stimulation source and a way of feeling the pulse in the market.
That said, the signal to noise ratio is so low on blogs that a high-precision service is the only way to make this workable, and feed aggregators are an increasingly overwhelming experience.
Part of our service is the process of finding and qualifying blogs - we include the ones we discover to be authoritative and original - and we invest both technology and researchers to stay ahead of a very steep curve. It's interesting that not every client of ours is crazy about them to start with. We spend time explaining our process and showing results from blogs crawls mixed in with the other obscure (but very insightful) content that we find.
Even if blogs aren't a nobrainer to everyone yet - it's clear they are taking off and taking over from some types of journalism. As the Intel marketing person said in the article above: "We will continue to invite bloggers to our events because we don't want to lose connection with the public,"