Lunch Links - April 9th, 2014

"Heartbleed" is a vulnerability bug in OpenSSL, the most popular opensource cryptographic library

By now you've probably heard of "Heartbleed", a bug in OpenSSL's implementation of the transport layer security protocols heartbeat extension.  The vulnerability was discovered by Google Security's Neel Mehta, and a full explanation of the bug is available here.

A fix has already been provided, so at the moment there is a race against the clock to implement the changes before they can be exploited.  Techcrunch wrote a piece about what Bitcoin users need to know about Heartbleed:

In short, update everything that touches your Bitcoin and don’t trust exchanges that haven’t explicitly explained their position on the exploit. Want more bad news? You should assume that all your usernames and passwords used over the past two years are compromised. This means you should change everything, not just your bitcoin data. A clever hacker could socially engineer her way into your wallet simply by knowing a few things about your online habits.

Major Moves

The Flatiron School, a coding academy in NYC, raised $5.5M in a Series A round of funding led by Charles River Ventures.  The two-year-old for-profit school will set you back between $10k and $12k for a course, but offers discounts for accepting a job offer through their own job network.  In exchange, the School pockets a hiring commission equal to 15% of the student's first-year base salary, according to their current hiring agreement:

Flatiron School Hiring Agreement

 As a Hiring Partner, you agree to pay a hiring commission equivalent to 15% of the student's first-year base salary. We've decided to structure our program in this way for two reasons: 

1. Charging employers a placement fee allows us to keep tuition as low as possible. 

2. Education today is too expensive and not focused on real results. By basing our revenue model on job placement, we are aligning our interests with those of our students. If we're not successful in training students for jobs, we shouldn't be financially successful, either.

Bay-area Q&A site Quora raised $80M in Series C funding to fund its international expansion.  The round was led by Tiger Global Management and sets Quora's valuation near $900M.  Quora is still revenue-less, but according to co-founder/CEO Adam D'Angelo, it plans on introducing its first keyword ads next year.


Personal Blogs

"Gotham Gal" Joanne Wilson pens a short piece on the importance of crafting your pitch deck:

A pitch deck tells the story of your business.  I have read enough pitch decks at this point that I should be able to open one and by page 3 if not 2 get the basis of the business.  When I get decks that are over 12 pages I find them hard to finish.  It should be bold and to the point.  Even 12 pages should not take very long to read.

I always stress the importance of redoing your deck several times.  It is no different than writing your business plan.  Putting information down on some kind of format makes it clear to you what is rambling around your brain is clear to others.  It is an opportunity for possible investors or even senior hires to get excited.

Instapaper-founder Marco Arment explains how to test your vulnerability to the OpenSSL bug known as "Heartbleed":

Test your vulnerability with Heartbleeder. It’s pretty shocking how many services, including many hosted by cloud providers that manage this for them, are still vulnerable a day after most Linux distributions had patches available — part of the problem is that this will also affect any load-balancer or other hardware that decrypts SSL for you before proxying unencrypted traffic to your webservers.

Marketer Seth Godin uses a string metaphor to describe the evolution of how we find new ideas:

Ideas used to be nicely wrapped up, wrapped in movies or books or some other sort of container. The Harvard Business Review and Fast Company would collect a bunch of them in one handy, easy to carry package. And the way we found those ideas was by going to the place where the containers lived and grabbing one. The bookstore was a valuable showroom for worthy ideas.

Today, ideas spread. We find them from someone we trust, or as they flash across the sky of social media. Today, people with authority and leverage continue to need new and important ideas, but there isn't an obvious idea store to go and pick up the next one. Instead, we listen to the pulse of what's going on around us, and see who is talking about what.

Lunch Links - April 8th, 2014

Major Moves

Neura focus on how people interact with their smart devices, and tries to make it as simple as possible.

Neura, a Bay-area / Israeli startup that seeks to integrate "internet of things" and wearable devices under common layers of technology, has raised $2M in Series A funding in a round led by Greenhouse Capital Partners.

Another Bay-area / Israeli startup, Tel Aviv's Kenshoo, just raised $20M to set their valuation between $400M and $500M.  Kenshoo provides a software platform for advertisers to manage their online marketing campaigns, and makes revenue from taking a percentage of the $5B in ad spending done on its platform annually.

North of the border, Toronto-based Wattpad raised $46M in Series C funding to aid in its vision to create a mobile online community of writers and readers.


Personal Blogs

Chris Dixon, General Partner at Andreessen Horowitz, describes how the rise of mobile apps is drawing development talent out of the mobile web:

This is a worrisome trend for the web. Mobile is the future. What wins mobile, wins the Internet. Right now, apps are winning and the web is losing. 

Moreover, there are signs that it will only get worse. Ask any web company and they will tell you that they value app users more than web users. This is why you see so many popups and banners on mobile websites that try to get you to download apps. It is also why so many mobile websites are broken. Resources are going to app development over web development. As the mobile web UX further deteriorates, the momentum toward apps will only increase.

Entrepreneur-turned-VC Mark Suster notes that a lot of reference calls end up being useless, and offers a guide on how to make better ones:

10. How to interpret references 

Finally, I’d like to point out that you need to be careful about how you actually interpret references. If you get somebody who doesn't say totally glowing things about your candidate make sure: 

• You think critically about whether that person may have biases that led him to the conclusions he has about your candidates  

• Make sure to ask other people about those specific qualities that the reference said weren't good – even if you have to call back people with whom you’re already spoken. 

• Understand whether any negative information is something that would stop you from wanting to hire the person. Everybody has weaknesses. 

The things that are always non-starters for me? People with attitude problems. Negative people. People who cause conflicts unnecessarily. People I perceive as not having good moral compasses.

Practical advice of the day:  Scotty Loveless of Overthought.org writes a detailed guide on using your iOS device battery to maximum efficiency:

Step 6: Turn Off Battery Percentage 

That's right, you heard me. 

Turn off that battery percentage meter and stop worrying about your battery drain. You can find this setting in Settings > General > Usage, right above where your battery times are listed. 

One thing I found in my Genius Bar experience is that people that are anxious about their iOS device battery life are constantly checking it to see the percentage and how much it has dropped from the last time they checked it. So if you check your device twice as much, simply to check on the battery life, you are essentially halving the time your device will last. 

Stop freaking out and enjoy your life. There are more important things to worry about than your device's battery life. The control freak inside you might freak out the first few days you do this, but you'll get used to it.

Lunch Links - April 7th, 2014

Major Moves

Healbe's GoBe may fit the "if it's too good to be true, it probably is" rule of thumb.

Startup or scam?  Russia-based startup Healbe released a much-analyzed white paper to try to dispel critics who note that the technology that the startup professes to own is likely decades away from being possible.  The campaign has raised over $975,000 USD on indiegogo as of Monday.

According to the Wall Street Journal, Bay-area mobile credit card reader startup Square has secured a line of credit from a group of banks including Goldman Sachs, Morgan Stanley, JP Morgan, and Barclays.  This line gives Square borrowing access to over $100M of capital.  Square could be securing this debt financing as a precursor to an eventual IPO, after postponing it indefinitely earlier in the year.

Square makes revenue through transactions, taking a fee from the $30B in total transactions it's projecting for 2014.  Of the $1B in fees collected, roughly 75% is passed on to partnering credit card companies, leaving a projected 2014 revenue close to $250M, around double of the 2013 net revenue (around $110M).

Chinese P2P bittorrenting and licensed video-streaming startup Xunlei raised $310 million in private equity funding from Beijing-based Xiaomi, a consumer electronics company with a heavily-hyped smartphone.  Xiaomi sold 4.4M of their smartphones in China in 2013 Q2, compared with 4.3M sold by Apple.  Xunlei claims over 230 million monthly active users and 4 million paying subscribers.

Personal Blogs

Entrepreneur-turned-VC Mark Suster explains how burgeoning startups can understand the hired-hand approach of sales culture.

Sales people: 

• Are motivated by cash. Founders think in options. Don’t confuse the two. Sales people want the stuff they can spend today. 

• Are more mercenaries than missionaries. That doesn’t make them bad – it just means that they know that they are “hired guns” and they act accordingly 

• Many great ones don’t thrive in the early phase of a company where the sales is more consultative or evangelical. They like a solid product, well defined pricing, good references to sell against, a clear quota and well defined competitors. This is why I tell startups that most seasoned sales execs aren’t right for startups. 

• They are as good at selling you as they are at selling your product to customers. That means if you don’t understand the way they work you’re susceptible to being blind sided. 

Here’s what I learned in running my first startup.

Marketer Seth Godin pens a short piece on how to avoid meandering toward nowhere special.

Five behaviors that often come clumped together, each conspiring to lead you toward disappointment: 

Big dreams: The goal isn't consistent impact or meaningful work, it's a huge hit, the star turn and the ability to change the world. It wouldn't be enough to have 1000 true fans, the big dreamer wants a stadiumful in every town. 

Poor work habits: Flitting from project to project, waiting for inspiration to arrive, stalling, not taking lessons, repeating the same early steps over and over... 

Shortcut seeking: Why bother with the long route when you can find a shorter, faster path? Get-rich-quick schemes, insider access and the quest to get it right now. 

Lottery thinking: This is a variation of shortcut thinking, but it involves getting picked. One person, one organization, one Wizard of Oz who will magically make it all happen. 

Lack of self-awareness: The self-delusion that your stuff is in fact world-class, and that the critics, all of them that you've managed to interrupt, are wrong.

Lunch Links - April 3rd, 2014

Major Moves

Spotted @SoFi in Midtown Manhattan! Awesome startup that refinances student loans via alumni networks. pic.twitter.com/xQxCImV4va
— Matt Nicholas (@MattAtMich) January 20, 2014

SoFi, the San Francisco-based startup that favorably refinances student loans through the university's own alumni network, has raised $80M in Series C funding, led by Discovery Capital Management.

Imgur, the image-hosting platform based in San Francisco, raised $40M in Series A funding in a round led by Andreessen Horowitz and joined by social link-sharing site Reddit.  This round comes two months after Imgur debuted an analytics platform for pro users and advertisers.

Fonemine, a Bay-area startup that develops enterprise mobility software, has raised $4.5M in Series B funding led by Ann Arbor-based Michigan eLab.

Personal Blogs

In an older post, Jason Goldberg, founder of designer sales site Fab, lists off 5 things that most young people don't yet know.

1. It’s better to do one thing exceptionally well than to do many things really good.  

News flash: Specialists get farther than generalists. If you want to rise to the top, own something. Be known for something. Have your one thing that you are simply the best at. And own it with pride. 

In my career I’ve found that people who have unique talents tend to rise to the top because they offer that unique something that others dont. Now, that unique talent can also be something broad like being a general, or being the the guy whose best at code reviews. My point is that you’ve got to be really good at something, not just kinda good at a lot of things.

2. It's okay to say I don't know.   

The young person who pretends that he or she knows all the answers comes across as sneaky and hard to believe. The young person who says I don’t know and then who comes back with smart well though-out answers, earns respect and trust.

3. People will do great things for you because they want to, not because they have to.  

People will do things for you because they have to, but they’ll only do great things for you because they want to. That means you need to spend as much time getting your colleagues to like working with you as you do getting them to respect your work. 

Just because you are smart will not always mean that you are effective. If you want others to want to do amazing things for you / with you, you need to inspire them and ingratiate yourself to them. 

Fred Wilson of Union Square Ventures ponders what it would be like to move from blogging to tweeting, and not just as an April Fools joke.

Tweeting is easier than blogging. It was that single insight that led me to email Evan Williams back in the spring/summer of 2007 and ask him if he’d allow USV to invest in Twitter. Thankfully he responded to that email and Ev and Jack did allow us to do that.

I had been blogging for almost four years at that point and was completely sold on the huge benefits that come from publicly sharing your insights, opinions, and decisions. I would advocate blogging to everyone. And folks would try it. And that vast majority of them (way greater than 90%) would not be able to sustain it. So when tweeting showed up, I thought “well this has most of the benefits of blogging but is at least 10x easier”. And then I wrote the email. Most good investment decisions are not more complicated than that.

Entrepreneur-turned-VC Mark Suster says hard deadlines help prevent your software development from becoming a broad research project.

There’s a healthy balance between allowing a design team to dream up functional requirements, talk with customers, analyze competitors and for technical projects – research the latest cool-kid tools to play with.

Design with no constraints becomes a research project.

You see there is a creative tension along the spectrum of  time and scope. If you pull too hard at the scope end of the chain your time drifts. If you pull hard at the time end of the spectrum you end up shipping inferior product. As obvious as it seems I assure you that many projects I’m involved with don’t sit down and have hard enough conversations about the need to hit time-based deadlines – so dates slip.

Lunch Links - April 2nd, 2014

Major Moves

Looking for delivery for lunch?  Apparently you're not alone - Grubhub, the Chicago-based online food ordering service, prepared for its IPO this week by increasing its price range from $23 to $25 per share, signaling it may have received a higher-than-expected demand from investors.  This change shifts their initial valuation close to $2 Billion.

Atlanta-based startup BitPay is raising between $20M and $30M in new venture funding to help more businesses process Bitcoin transactions.  Despite recent volatility, it seems many VCs aren't shying away from Bitcoin's potential as a widespread currency.  In fact, China's largest Bitcoin exchange, OKCoin, just landed $10M worth of backing from investors in Hong Kong and Beijing.

Personal Blogs

Entrepreneur-turned-VC Mark Suster talks about "The Innovator's Dilemma" and why legal push-back on companies like Uber, Tesla, and TrueCar may be a sign of having the right startup model.

I’m sure you’ve all read about similar stories like Uber and Lyft being banned by cities for providing a transportation service consumers finally love or Airbnb for low-cost, more homey alternatives to hotels. Or when Viacom sued YouTube, the music industry sued Napster or even when Hulu was created (I think I was the first to publicly call out that Hulu was really formed like OPEC.)

Turkey or China? Twitter. Even governments don’t like losing their monopoly – control of the media.

If the industry you seek to disrupt isn’t fighting you back yet it’s just because you haven’t yet made a dent in their consciousness or pockets. No 800-pound-gorilla gives up control easily without a fight.

In an old post, Leo Widrich, the co-founder of social media scheduling app Buffer, pens a short piece in defense of reinventing yourself.

And then, after our attempt to change comes the sentence. It is being told to us by someone we know so well, maybe our friends, maybe our family. And it hits us like a knife being stabbed into our stomachs:

“But that’s not the <name> I know. You are a different person now!”

What follows in many cases is ridiculing, laughing, disbelief of your new actions. Your surroundings, your friends, your family, who have come to know you as this or that kind of person won’t accept the new “you” that you are exploring. Change is always hard; for everyone.

And so, slowly the shy guy becomes more shy again. The pessimistic girl gets back to smiling less and complaining more about the hard life. The feelings are getting suppressed again.

We cannot change without the environment around us approving of us. As hard as this truth may sound, it is something that I have found more persistent than anything else.

So what we have to do, if we really want to reinvent ourselves is to change our environment. It is to find a place, where we can change and become a different person.

Dan Martell, Canadian serial entrepreneur and 500Startup mentor, comments on Sean Ellis' method of testing growth hack experiments.

I think if you are hoping to generate ideas by brainstorming with people that know very little about your customers, product, market, etc, that you’re likely to be pretty disappointed with the result.

My recommendation is…

1) Study the growth engines of successful emerging companies

2) Learn about emerging platforms and best practices

3) Talk to 100s of your customers in a relatively short period of time

And finally, Marco Arment, coffee-enthusiast and initial lead developer at tumblr, pens a lighthearted defense of Keurig coffee machines.

We’re the ones who obsess over every little detail of brewing technique as if they matter much more than they really do, making good coffee ever more alienating and confusing to casual coffee drinkers who don’t have time to study and fuss over it as much as we do.

Can you blame people for enjoying a simple, automatic, one-button system, considering the alternatives that we keep making ever more complicated, fussy, and demanding of their time and technique?

The alternative that we present sends a clear message: “We are cool, this is fancy, and your coffee is crap.”

The latter is true, but at what cost?

Photo by Mathieu Thouvenin

Lunch Links - April 1st, 2014

Major Moves

With Q1 of 2014 behind us, Dan Primack of Fortune noted that the US has had 71 IPOs so far this year, marking the most first-quarter IPOs since 2000.  After looking through a few years of IPO data, I put together a graph showing the market recovery since the 2008 meltdown.  This year is projected to have the most IPOs since pre-meltdown levels in 2007.

NeuMoDx Molecular, an Ann Arbor-founded molecular diagnostics company, announced $21M in Series B funding, led by Pfizer Venture Investments and followed by Baird Capital, Arboretum Ventures, and the Wolverine Venture Fund.

In Austin, the local merchant-funded loyalty program Buzz Points raised $19M in Series D funding, leading to a $65M valuation.  Part of the investment will support rollout of Buzz Point's marketing platform on investor PULSE's network.  


Private equity firm Ares Management announced plans yesterday for a $100M IPO, the largest public offering of a private-equity firm since Carlyle Group LP raised $671M in 2012.  This comes after its business development company affiliate Ares Capital Corp raised $283.2M in an IPO last December.


Personal Blogs

Fred Wilson of Union Square Ventures talks about the value of an engineering degree.

You might be surprised to see Stevens Institute and NYU Poly on that list. But I am not. NYC is starved for the kind of technical, quantitative, and analytical minds that engineering schools generate. Combine a big urban center with a top engineering school and you have a recipe to print money. And you have a recipe to change lives. Many of the kids who go to NYU Poly are from immigrant families and are graduates of the NYC public school system. They are smart and work hard. And with an engineering degree and a big city like NYC, they can earn more in a year than their parents earn combined.

The value of a diploma is set by the marketplace, by the laws of supply and demand. There are more technical jobs open than qualified candidates to fill them. It is the one bright spot in an otherwise bleak employment picture. 

"Gotham Gal" Joanne Wilson talks about Rebecca Rachmany of Israel-based Gangly Sister, a web-based program aiming to foster high-tech interests in girls.

Rebecca has had this concept rolling around in her head for a long time.  The video is worth watching and I do believe she is on to something.  She wants to build a company to be the content provider for young women (and boys) who become connected to role models that are tech saavy and love being engineers. 

Entrepreneur-turned VC Mark Suster explains his most frequent advice:  Be Politely Persistent.

But how do you get past gate keepers? How do you get on elusive calendars or invited to speak at conference?

1. Well, for starters you need to be a great networker. I wrote an example of why this matters when meeting VCs but it’s true of all exec. Nothing beats a warm intro.

2. You need to know how to write good & action oriented emails.

3. You need to know how to make good phone calls and not be afraid to pick up the phone.

4. Understand reciprocity and how helping others earns you good karma points – and favors.

5. Be humble – nobody likes too much arrogance; but

6. Don’t be afraid to be a bit cheeky. You can take some risks. You won’t have success with everybody you approach but I’d rather see you show some juevos and / or some humor sometimes to stand out. Just don’t go overboard.

No April Fools jokes for LunchLinks this year - I'm far too busy catching Pokemon on Google Maps.

Lunch Links - March 31st, 2014

Major Moves

Crossbar Incorporated is a Bay-area consumer electronics company working to usher in a new generation of non-volatile memory through "Resistive RAM" (RRAM) tech.  They'll get some help in their goals through $25M in Series C funding, joined by SAIF Partners, Artiman Ventures, KPCB, Northern Light Venture Capital as well as my alma mater, the University of Michigan.  Founder Wei Lu previously worked in the Electrical Engineering department at the University of Michigan.  

ClearStory Data, another Bay-area startup, wants to make it simple for business users to gather data from dispersed data sets across internal sources, corporate sources, Hadoop, and the Web.  They have received $21M in Series B funding, in a round led by DAG Ventures and heavyweights Andreessen Horowitz, Google Ventures, Khosla Ventures, and KPCB.  

Kitchensurfing, a startup based in Brooklyn, is seeking to make finding a private chef as easy as booking a hotel room online.  They received $15M in Series B funding, in a round led by Tiger Global Management and joined by Union Square Ventures and Spark Capital, and may raise their valuation to approximately $40M.

Personal Blogs

Joel Gascoigne, founder of Buffer, a San Francisco startup that helps you share across all social media, explains how his co-founder and himself structured themselves when the time came to use labels such as CEO and COO.

In the first week of December we were in Thailand for our second company retreat. It was during our time there that Leo and I had a lot of lengthy walking meetings around Pattaya about the structure of our roles. We talked a lot. I couldn’t think of a more perfect setting for us to figure these things out. We’re both optimistic people and despite the tough conversations we knew we’d come to a conclusion about how things should work. We had gratitude for how lucky we were to be in Thailand and had built a company to a stage where this problem had arisen.

Justin Kan, new YC partner and founder of Exec and Justin.tv, gives a post-mortem on Exec Errands, an app that sought to find people willing to do simple tasks in their spare time, and offers his own diagnosis of what he would look at differently.

Customer acquisition was hard. Lyft and Uber are viral online-to-offline businesses, because many of the times you call a ride you take it with others (who subsequently think it’s an incredible experience and download the app). Exec Errands was a not nearly as viral (and cleaning not at all), because you could use those services without ever telling anyone.

In an old post, but one that bears mentioning, Ben Milne, founder of payment network Dwolla, advises to “solve problems that piss you off.”

Q. “How much does this really piss me off?”


A. Tons. Shit, I hate this. I see it everywhere. I sign up for new services hoping it does it differently, and it never does.

Something I hope you can take away from this: 

YOU CAN’T SOLVE THE PROBLEM WHILE YOU ARE CONTRIBUTING TO IT. 

So, I know it bugs me to no end, and I know I can’t let it go. It’s not a personal issue, and the more I think about the time we all lose to this junk, the more it bothers me. This may not be true for others, but for me, if a problem:
1.   Doesn’t get me out of bed
2.   Make me lose sleep
3.   Drive me to the point of getting angry when I see strangers doing it
4.   Make me swear constantly about how obnoxious it is that I’m doing it
5.   Isn’t systemic in society (a lot of people deal with it) 

 Then I shouldn’t solve it!