David Crow

Connector of dots. Maker of lines. Rider of slopes.

davidcrow

A Golden Age for Indie Business

by

“the mainstream startup narrative is owned by VC backed startups who’s success and ambition are often measured by the amount of capital they’ve raise. That’s a fine narrative, but not the only one.” – Bryce Roberts on Indie.vc

I have been focused on furthering the narrative of VC backed startups. From the start of DemoCamp almost 10 years ago, the goal was to find venture fundable companies. It also allowed the use of venture funding has become the default proxy for determining the success of companies and the health of the ecosystem. The more venture capital deployed the healthier the ecosystem with more jobs and greater impact. There are a strong number of Canadian venture funded companies:

Is venture funding the only narrative that matters? There are other companies in Canada that are participants and help define the ecosystem?

“there’s a cultural shift towards taking little to no VC investment, staying independent longer (or indefinitely) without sacrificing the ambition for building large, profitable and impactful businesses”
– Bryce Roberts

There are crazy entrepreneurs across Canada that are building big, impactful companies.

There are companies that are building outside of the narrative of venture capital and venture funding. They are defining their own rules leveraging distribution and monetization paths to companies outside of the venture narrative. These are important companies. I really like Bryce’s description of these businesses as “indie” and not “lifestyle”. Just like independent music, I think it better represents the ethos and motivations of these business owners.

“Can we provide the resources and networks founders would traditionally get taking VC money, without all the expectations and baggage that come with it? Would an early focus on cashflow and sustainability v. fundable milestones stunt growth or lay the foundation for a more scalable long-term culture? Is it possible to maintain and independent attitude and ethos with an outside investor on your cap table? And could these types of companies compete, and win, against their traditionally VC funded peers?”
–Bryce Roberts

It’s exciting to see a venture fund recognize the importance of these independent business. To look at the tools, milestones, connections and content around cashflow, sustainability, recruiting and culture.  Before the funding announcement in July 2014 it was easy to imagine FreshBooks remaining an independent. Mike McDerment has been a fixture in building and supporting independent companies and events like Mesh Conference for the past 10 years. The assumption is that FreshBooks was able to build strong culture and was able to raise financing at their own terms. This is a really interesting time, and it is amazing to see a group of independent technology businesses grow in to large, impactful companies.

As Bryce says, “we’re entering a golden age for Indie businesses”, and I can’t wait to see the companies that it brings.

Featured photo by Andrew Stephenson 

Questions for 2015

by

Benedict Evans posted the questions he’d like answered in 2015 and in mobile with the platform wars over. Here are some of the questions I’d expect to see answered in 2015 for Canada and Canadian companies.

  1. What happens to Canadian companies in the mid-stage?
    Jim Orlando described a strong 2015 market in both early stage (local) and late stage capital (international) for technology startups. Are their enough Canadian funds that can invest >$15MM/company, i.e., >10% of their capital pool, to fund growth stage Canadian startups?
  2. Where will Kik land?
    Ted Livingston’s view of messaging as universal UI and the race to become the Wechat of the West feels like the right thing. It seems like figuring out how to operate profitably is not the most likely outcome, so it must be an exit. Facebook has already acquired Instagram and Whatsapp, so it seems like this is out (particularly given a teenagers view of social media apps).  Does a non-Google Android provider like Cyanogen or Xiaomi purchase Kik?
  3. When will a Canadian company report their first major cyberattack and breach? We’ve seen attacks and branches on the federal government it feels like only a matter of time until a financial institution or retail announces a major breach.
  4. How many narwhals will we see?
    There have been a number of US companies go to the public markets including Hubspot, Box and others. It feels like there are a number of Canadian companies that are on cusp. How many will forego the TSX and only go NASDAQ or NYSE?
  5. Will Shomi and CraveTV become true OTT competitors allowing non-cable subscribers access to compete with Netflix? Or do these offerings plus GameCentre Live and other live sports keep cable subscribers in Canada?
  6. Will Netflix be forced by content owners to cut down on grey market geofencing? What does this mean for services like Unblock-Us and TunnelBear? What does it mean for accessing foreign content like BBC iPlayer, Premier League Pass, NFL Game Pass? (p.s. where is my Internet access to Formula 1?)
  7. Will the Copyright Modernization Act changes that went live on Jan 1, 2015 impose additional fee increases because of management costs for independent ISPs?
  8. When will ApplePay launch in Canada? Will Apple be able to get mobile payments adoption than Suretap, Enstream, PayWave, PayPass, etc. that the carriers and banks have?
  9. Will one of the Canadian wearable companies begin rolling up others, that do not find product-market fit or a large enough audience, for the talent? Or will they be acquired by larger players like Under Armor?
  10. What impact for will the falling Canadian dollar and resource economy have on the tech ecosystem? We’ve already seen the rise of minimum app prices in the iOS store on Jan 9 to Cdn$1.19. Will a weaker Canadian dollar see a resurgence of the conversation and companies around near-shoring for larger US companies? Will this continue to build a stronger acquisition market for startups that struggle to find mid-stage growth capital?
  11. Do we need a Canada-based data centre for one of the larger hosting providers, i.e., Digital Ocean, AWS, Azure, Rackspace? IBM opened a SoftLayer data centre in Markham in 2014, with a few startups building on the infrastructure but all of the startups were still very small. Does data or computation sovereignty matter to Canadian startups?
  12. Is there a need for another startup conference in Toronto? There are great events in Montreal (Startup Festival), Vancouver (Grow Conference) and an investor focused event in Toronto (Canadian Innovation Exchange). But is there a need for more functional led events (design, growth hacking, CTOs, etc) like Warm Gun or Brooklyn Beta?
  13. Does one of the wireless carriers create a division or group with tools and pricing to support a strong IIoT ecosystem? We’ve seen Canadians like their oligopolistic carrier ecosystem, but there are segments like Wind Mobile users that are willing to compromise coverage or roaming for price. It is unclear if a 4th national carrier can survive on these customers alone, and the CRTC has determined that Telus cannot absorb Wind as their discount brand (like Fido or the MNVOs on Bell). Is there an alternate model where Wind or other carrier bets on the data carriage fees and the necessary tools to build a stronger IIoT ecosystem. The tools that mix RFID, cellular and Wifi?

Thanks Gideon Hayden for feedback and insight on the post.

Bottom up healthcare

by

[slideshare id=40841467&doc=201410wsjdbe-141028165857-conversion-gate01]

Fred Wilson wrote about his thoughts on what is going to happen in tech in 2015.  I was struck by his post on “the pressure of real patient centered healthcare” emerging from “the smartphone becoming the EMR“. It was the pressure for change put on organizations and marketplaces from the bottom, i.e., the direct consumers. Health care is a market place where change is top down. The influence of doctors, administrators, insurers, bureaucrats has always be stronger than those of the patients.

“11/ the health care sector will start to feel the pressure of real patient centered healthcare brought on by the trifecta of the smartphone becoming the EMR, patients treating patients (p2p medicine), and real market economies entering health care (people paying for their own healthcare). this is a megatrend that will take decades to fully play out but we will see the start of it in 2015.” – Fred Wilson

Access to new technology, access to new people and access to new business models is changing this. It was the first time I had associated Benedict Evans’ Mobile is Eating the World with the pending megachanges that are coming for health care. Someone is building the “Uber for healthcare”, and for me I understand why it will be mobile that allows healthcare to be reimagined.

Mind blown. Thank you Fred and Benedict.

 

 

Posted on Filed Under: Articles

Rebuilding old habits

by

I didn’t write a personal blog post in 2014. My last post was written May 8, 2013.

I wrote a few posts on StartupNorth but generally it was a quiet year.  The most engaged post I wrote in 2014 was “One Post to Rule Them All” where I tried to share my view of the startup landscape in Toronto.

I need to write more often. I need to rebuild the habit of writing for myself.

Image by David Lofink

The Calendaring Land Grab

by

There is a lot of chatter about calendar being the next native iOS application (much like Mailbox and Taskbox for Mail) that is set to be out replaced by a startup.

Atlas Scheduling Re-Invented - Today Feed - Events & TasksJust looking at my phone you’ll find:

I’m hopeful for Atlas because it has the potential to replace and improve on Tungle.me, ScheduleOnce, Doodle, Skedge and others (see Adam Popescu’s article on Mashable). I’m hopeful that it is as useful a calendar as Sunrise, but the advanced scheduling features are something I still crave post Zaplet (it’s funny, I remember building those screenshots back in late 1999).  The group scheduling application is feature, not a fully functional calendar.

I seem to struggle with  the business model for calendaring applications. I understand why companies like Apple, Facebook, Google and Microsoft need to have applications that are engaging and functional for users on their respective platforms. But it feels like a user acquisition land grab. But one that is focused on engagement and not monetization. I guess a queue of >500,000 users can net you an acquisition around $100MM users.

Chief Shit Disturber

by

My friend Howard Gwin (LinkedIn) has said the perfect role for me would be one of “Chief Shit Disturber”.

“an individual who creates unnecessary conflict and unhappiness where it is especially not required” – Urban Dictionary

I’m not sure that this is quite what Howard intended. But that I live in the creative tension between product, marketing, development, customers and growth. It’s a chaotic place where the demands change instantaneously and often change due to forces unrelated to the company or the team. (Or at least that is what I hope Howard means, and not that he thinks I stir up trouble unnecessarily.)

I have often thought that the perfect role for me would be one like James Higa, who Steve Jobs picked as “his right hand man”.

“One was an ability to be frank, honest, and able to go toe-to-toe with him on any question. The other was wide peripheral vision. He’s always wanted that in the people around him. The ability to connect dots is really important. A Renaissance perspective on the world. Because it was always about the intersection of technology and liberal arts. BusinessInsider

Not to say, I won’t do the founder thing again. Founding Influitive was exciting/fun/stressful. Leaving wasn’t easy, but it was the right thing to do for me, for my cofounder and for the company. It gave Mark the room he needed to operate more effectively. I have enjoyed going toe-to-toe with Mark on everything from product design, to customer acquisition, to fundraising, to hiring, to company culture. I think Mark appreciated the candor and insight, as he has a Chief of Staff role that sounds strangely familiar to me.

But it has me on a new career path. I am back in a world as a consultant. I’m not sure that this consulting thing is going to be a permanent thing (see Teehan+Lax: A Happy Accident), but I will try it, at least part-time. I am spending part of time at OMERS Ventures, where I get to see how the sausage is made. But I’m trying to figure out what to do with the rest of my time.

I have worked with startups for a very long time. Some have been successful. Some haven’t. But I know I add value. The challenge with early-stage companies (pre-Series A) is that they can’t afford to pay me (for more reasons why this is important). I am looking for models that work and don’t work for a consulting practice. Yes, yes beware the consultant. And consulting math versus software math. And you can read my thoughts on being/using a funding broker, ain’t happening.

It would be easy to pay for bits or bit development. But we’re talking advice. Kind of like a lawyer. I can’t figure out how to make this work. Any thoughts?