Saturday, 2 April 2011
This Wednesday saw around 500 people descend on the Park Plaza Victoria for GeekNRolla 2011, Mike Butcher’s annual startup conference. Priced at £150 it’s significantly cheaper than most of the well known US conferences (or indeed Le Web), although it is on a smaller scale.
The event attracted some great speakers, including prolific angel investor Dave McClure giving his usual profanity riddled Startup Metrics for Pirates talk, Morten Lund delivering his unique brand of slightly unhinged inspirational advice and some great insights from Martin Varsavsky founder of FON.
Wendy Tan White took us through the rollercoaster ups and downs of running Moonfruit from 1999 to the present day, and a fireside chat (sans fireside) with Josh Williams of Gowalla revealed plans to open a London Gowalla office.
As usual with these events, you have to make a tradeoff between the panels/talks/pitches and talking to people in the lobbies and corridoors. I tried to see most of the speeches and pitches but skipped some of the panels.
Show me the money
In a surprise turn of events, DFJ Esprit decided to offer the winner of the pitching competition a £50k investment in the form of a convertible note priced on par with the next investment round. For those not familiar with venture finance, this is a pretty good offer, since it effectively means that DFJ are not being compensated for the early stage risk compared to a later stage investor - typically convertibles are priced at a discount to the next round.
It’s worth noting that taking seed capital from a VC does carry some signalling risk if they don’t follow on, and convertible notes have the disadvantage of giving the investor and the founders differing incentives for the pricing of the next round. However given DFJ’s reputation and partner Nic Brisbourne’s active involvement in the London startup community, I can’t imagine anyone turning down the offer.
I thought it would be interesting to take a look at the companies that were pitching. Each was given two minutes to pitch and then had a few questions from the judging panel:
Duedil (overall winner). Aggregating business information. A bit like CapitalIQ, but with the intention of providing end users access to company data for free. In their pitch they had a great example use case for consumers - verifying the credentials of a visa service before handing over your passport. Beyond this one can easily see many uses - small businesses running checks on customer or partners, competitive intelligence, investor research etc.
In the presentation they mentioned “Business Voyeurism”, and after playing around with the rather slick alpha-release product today, I can see exactly what they mean - it’s pretty addictive to just navigate around the details of companies and directors with such ease. Of course this data is all already publicly available from the likes of Companies House at low, but non-zero, cost through a slightly clunky interface, and so it’s the ease of use combined with zero cost and aggregation of multiple data sources that makes Duedil such a great product. The UI could still do with some tweaks, but it’s looking pretty good and I can see why they deserved to win the competition.
During the presentation they struggled to explain a concrete plan for monetization, and from speaking to them afterwards I think in part this stems from their strong drive for using Duedil as a tool to encourage transparency and hence always keep the basic product free to use. I’ve no doubt they’ll solve the monetization question in due course.
WireWax. Making video clickable. These guys have built an application that allows you to highlight hotspots in videos (like people or objects). The application will then track them through the video and allow end users to click on the tagged areas or hover over them for information. This can then be used to e.g. find out what clothes people are wearing and then click through to buy them. The product seemed to be fairly well developed and they already had ITV as a customer. A pretty good presentation and the questions from the panel seemed to focus on the fact that there were several competitors in this space.
ArtSpotter. Crowdsourced Art finding maps. An iphone app at the moment, presuamably with plans to move to other platforms if they get traction. Most impressive thing about this which the panel didn’t pick up on was that the founder got the app built for just £1500 (and didn’t develop it herself).
Frameblast (Clearer Partners). This one appeared to be a B2B marketplace for video production services. I say appeared to be since I’m not sure I fully understood the pitch. I suspect the presenter may have suffered a little from being deprived of the notes accompanying his slides. They seemed to have assembled a team with strong industry knowledge (ex-BBC and Joost), so I guess they know what they’re doing. Perhaps a case of the shoemaker's children going unshod? With a bit more polish I’m sure with their production background they can deliver a much better pitch.
PoraOra. Browser based 3D learning. Kids wander through a virtual world (MMORPG style) except instead of slaying each other or building virtual property empires, they solve sums and practice their spelling.
The graphics looked pretty slick and they had a nice marketing video which seemed to work well. PoraOra uses a virtual pet as the incentive mechansim - learn your times tables the pet gets healthier, mess up your negative numbers and Fido is off to the glue factory. The virtual pets following the kids around reminded me a little of the daemons in Phillip Pullman’s His Dark Materials, but I guess this game is aimed at a younger audience.
Education is a topic close to my heart, and Khan Academy has demonstrated the kinds of innovation that are now possible in the way we teach and learn, in particular giving learners control over their learning, and giving teachers/parents access to much more data and analytics than has ever been possible before.
The main concern raised by the panel was the question of how effective the game would be in keeping the attention of ADHD riddled kids. That’s a tough one to crack, but I guess there’s no reason why kids can’t play both PoraOra and Grand Theft Auto rather than picking one over the other.
TheSocialCV.com. Collects social information about people, runs some semantic analysis and compiles it into a unified profile. They mentioned it was in a similar space to the Salesforce acquired Jigsaw, and it also sounded similar to Qwerly (although it sounds like they do more semantic processing). Started as a research project with Google. From the name and the site, it appears the main focus is on using the application for recruiters.
Online social identity certainly seems to be an attractive market, which also means there are quite a few people competing in a similar space.
The biggest issue with the pitch seemed to be that they were pitching a product rather than a business but paradoxically they didn't really get to the product until about half way through the pitch. The demo when they showed it look pretty good, and would have been better to have this up front. They used a recorded demo from SXSW, but it would have been amazing if they could have run a demo based on the people currently at GeekNRolla.
Yearbook Machine. An yearbook creation service with a focus high quality design and good UX. Having been part of the team putting together a yearbook at grad school, I’m very familiar with the pains involved, and I can see the economics of this business making sense (spreading fixed costs over many customers etc).
Most of the panel’s questions were about competitors and the risks of general album/photobook printing services (like Blurb) moving into the yearbook space. However I suspect that if these guys have a slick product focussed on the Yearbook vertical, they should be fine and could possibly exit to one of the album publishers.
The presenter wore a yellow pocket square which was a nice touch. Not because the sartorial standards at GeekNRolla were lacking, but rather because little quirks like that make sure people remember you, and make you easy to find for anyone who has questions. Startup t-shirts work fine too in case you’re a bit rusty on pocket square folding techniques.
AreaNow. A mobile local nightlife app. Very offbeat presentation style and slides. There are quite a few people trying to solve the local events problem - maybe this team might manage to do it but it’s not immediately obvious how.
Qublus. Indoor positioning based on radio signals. Didn’t go into details about their technology, but said it works better than GPS or Wifi triangulation indoors. You need to map the building before you can use it, but then the end users just require a mobile app on their phone. They've built a mall app in Sweeden already. Certainly intruiging - if the technology is as good as claimed this could have a number of applications, including delivery of hyperlocal advertising in places like Westfield.
FlyPost. Turning distressed events into deals (e.g. groupon for unsold local ticket inventory). Simple and to the point presentation. Bringing effective yield management to local businesses is something that GroupOn defintely have in their sights, and there are several people competing in the ticketing space, however nobody really seems to have cracked this one yet, so plenty of opportunity.
One issue raised by the panel is the problem of adverse selection - the only tickets sold on this service will be undesirable ones that haven’t already sold. While this is certainly true, there’s a certain underlying assumption in the question that all tickets have the same utility for all customers, which isn't true. Thus just because most people don’t want to go see Justin Bieber in concert next Saturday in Slough, doesn’t mean other people wouldn't were they made aware of the opportunity at a low enough price.
MarketInvoice. Pitched as working capital financing for SMEs, but essentially a marketplace for factoring invoices. From the questions and answers it seems that they take care of grouping together the debts in tranches and also syndicating them amongst investors. Not sure where the responsibility for assessing the credit risk lies, but seems like a classic internet disintermediation play like Zopa. The main question seems to be whether there are enough businesses interested in joining as factors.
Art finder. An art discovery and sharing site. They also produce a collection of ipad apps in the style of coffee table books along with print on demand artwork. A new take on presenting art - seemed to be well put together and I guess the only questions are really around who else is competing in the same space. If Artfinder can build a strong database of art and form partnerships with museums and artists, then they should be in a pretty good position.
Updates and a tip for future
There were also updates from BraveNewTalent, Conversocial, GroupSpaces and Qwerly who all seem to be making great progress one year on from the last GeeknRolla. Special mention has to go to Max Neiderdoerfer for the most hilarious (yet informative) presentation featuring the Rageguy.
All in all a great conference, and a great place to launch a startup. The one thing I’d recommend to anyone pitching is to make sure you’re early on in the running. By the time the later pitches occurred the room was more than half empty, and in particular the last few were in the dreaded just-before-lunch slot. Might be worth re-arranging the pitches to put half in the afternoon instead to make it a little fairer.
Posted by Zeshan Ghory at 15:13