• Posts

    Embracing the Incrementality Mentality

    We’ve all heard that line about the 10 year “overnight” successes. A friend* recently told me a key metric of his company was growing 4% week-over-week. Actually, he related with some dismay that it was only growing at 4%, and he was looking to build another product to make their company more attractive for raising the next round of funding. I was shocked. The base number that this 4% growth is accumulating on top of is in the billions, without much marketing or distribution yet. They found a problem many people had, solved it elegantly, and then forgot to tell those people about it. Instead of doubling down on something…

  • Posts,  Startups

    The $3B+ Exit Tumblr Could Have Had

    It’s all over the news, Yahoo! is in talks to acquire Tumblr. The popular blogging platform, which was founded in New York in 2007, has just a few months of cash left and hasn’t successfully monetized their platform fast enough to cover costs. To date investors have put $125M into the company, most recently infusing it with $85M more in September 2011 at a valuation of over $800M. According to Forbes Tumblr is targeting $100M revenue in 2013 but, according to sources I spoke to who are familiar with the company, actual Q1 revenue growth was flat and Tumblr is on track to do only $15M in revenue this year.…

  • Posts,  Startups

    Past Performance is No Guarantee of Future Results

    Past performance does not guarantee future results for startups, venture capitalists, accelerator programs, the media, individual founders, or any other part of the startup ecosystem. On the mission to see into the future, there is a tendency to over value the information and lessons of the past. With 20/20 hindsight it seems obvious that things would turn out the way they have. Cell phones? Computers? “If I had been alive back in the 1950s I so would have called that,” you say. Television? Telephone? Automobiles? “Obviously I would have been first in line to get mine!” But would you have? Really? Massive changes in how we build things, operate our…

  • Posts,  Startup Index

    New 500 Startups Batch Announced. Who Has the Most Momentum?

    500 Startups announced the non-stealth participants in their current batch today in a TechCrunch article, and while they’ve kindly put them in alphabetical order… you probably know by now that’s not how I roll. I’ve been tracking many of these companies for awhile now and will certainly start tracking those I missed. It will be interesting to see how this rank and momentum scores at the beginning of the program compare to the end of the program. Are you a future investor, employee or customer for these companies? Get on it. My advise to the startups looking to increase their score? Every day we hustlin’ #500strong Full Disclosure: I am…

  • Startups

    New York Startup Index: 500+ Companies Ranked by Momentum

    This is the Startup Index series, an ongoing effort to measure the momentum of startup companies using external signals. It is calculated based on weighted factors such as web traffic, social media share of voice, inbound links, etc. I usually add some music, to make cruising a spreadsheet a little more fun. Enjoy! The Startup Index is inspired by the Seattle 2.0 Index, which Marcelo Calbucci produced each month to create a leaderboard for local startups and it is now the basis for the Geekwire 200 in Seattle. But why stop at Seattle? There are many so many startup communities around the world, and today I’ve applied our algorithm to…

  • Posts

    Revenue vs. Value

    I get a lot of feedback asking why the monthly startup momentum index doesn’t include revenue as a signal. There are two reasons, and the first is that most startups don’t want to provide that data to outsiders. The second is a bit counterintuitive, but stick with me and I’ll explain: revenue doesn’t actually matter for finding hot early stage startups. Startups aren’t supposed to be revenue machines right away; at first they’re designed as business model experiments. While revenue is a useful signal to founders, indicating they are creating something people want, it is also a lagging indicator of success. Startups who are willing to reveal revenue data publicly…

  • Posts,  Startups

    Startup Index: Y Combinator Companies Have More Than 2x the Momentum of 500 Startups, 3x Techstars

    How to Read the Startup Momentum Index Momentum measures a quantity of motion, measured as a product of its mass and velocity. In case we want to measure the momentum of a startup (the “body”) where mass is the company’s share of web traffic (as measured by Alexa rank) and velocity is the growth trajectory of several different signals (social, inbound links, page rank, etc). It is weighted toward sustained growth, versus small spurts of growth from press coverage or a burst of paid traffic or Twitter/Facebook followers. Larger companies (by traffic) who see a decline in growth across these signals will be the hardest hit, so the worst place…

  • Startups

    Thoughts On YC Interview Prep

    Companies currently interviewing for Y Combinator have taken the Internet’s advice to reach out to alumni to practice before they present, but unfortunately we don’t scale very well. I’ve prepped with a dozen teams so far and will probably talk to a dozen more before the weekend ends, but that will hardly scratch the surface. I am asking them all the same questions, so I thought I’d sum it up here for people I won’t have time to chat with. My phone number is 425-698-7497. Call me for a 10 minute prep session. If I don’t answer just try again (or you could build a Twilio app to keep trying…

  • Posts

    Art Is Hard

    My old startup died. I have been working on my new startup. It’s kind of named after this band I love, but not entirely. New name, and we’ve got a long way to go. Art Is Hard Cut it out – your self-inflicted pain is getting too routine the crowds are catching on – to the self-inflicted song Well, here we go again – the art of acting weak Fall in love to fail – to boost your CD sales And that CD sells – yeah, what a hit You’ve got to repeat it you gotta’ sink to swim If at first you don’t succeed you gotta recreate your misery…

  • Posts

    Double Tap

    Last night I logged into Referly for the first time in a few weeks. I’ve been trying not to do that, because there are still so many things I want to fix and when I see them I just… and I was so in love with it and it’s just… and knowing that we aren’t continuing in this direction it just… hurts. It hurts. I logged into the admin panel. I don’t know what I expected to see. If you’ve ever wondering what would happen if you stopped working on your startup I can tell you now so you don’t have to satisfy your morbid curiosity. If you stop working…