Even though SXSW 2010 was all about the “Location Wars” between Foursquare an Gowalla, Tthe LBS sessions talked about what is being outside of those 2 companies. Josh Williams, the CEO of Gowalla, said in an interview by Robert Scoble that check-ins are now a commodity; its what you do with the check-in and location that is interesting. The companies that spoke, and the examples they gave are prime examples of this. WaveMarket has built a tracking platform for Uship, and they are working on an app that will allow anyone that crosses the state border into Nevada to place a bet from their phone. While these apps don’t require the traditional game type “check-in”, they are examples of what can be done since check-ins, and location in general, is commoditized.

The most lively session i attended the whole week was Can Web 2.0 Kill the Real Estate Industry? I have a keen interest in real estate due to buying and selling multiple houses since I graduated college. The room was well represented by Realtors, and they were the vocal minority. The biggest debate seemed to focus on feedback and ratings: non-agents wanted a way to rate or see ratings of their agent and property, while the agents were completely against it. They claimed that the rating for the property is done in terms of days on market, and agents are gone within a year if they do not perform adequately. The same gentleman that said agents do not need ratings also said later that it is the buyer or sellers fault for picking bad agents since they do not do any research on the agents. Instead, they go with the first agent that contacts them back. Well, if there are no ratings or reviews on agents, how is a buyer or seller supposed to know if the agent is any good or not? I personally ended up with a horrible agent in Florida, but she would not let me out of the 3 month listing period contract, even though I had evidence she changed the contract after it was signed. That would have been a huge red flag in a review, but there was no information like that at the time, just referrals from her trusted sources.

I was amazed in this session how anti-change the Realtors were; they somehow argued against some obvious facts. It reminded me of the music industry’s fight against peer-to-peer file sharing systems. The change happened, the established companies realized they’d lose money, so they fought to keep the old way instead of progressing and adapting to new realities. One example was a Realtor that claimed that during the past decade, tons of Real Estate date became open and available to everybody, but that did not stop stupid buying decisions, which led to the bubble and collapse of the market.

Having home prices and other real estate data finally not being guarded by Realtors was not the major cause of the market collapse. Low interest rates, greedy lenders and agents, and crazy mortgage requirements is what fed the boom and bust. The data would have flowed regardless of if it was private or open. I would argue that some agents helped push buyers into “stupid buying decisions” to increase their commissions. The open data probably helped save some people from buying more than they could by being able to compare homes and see trends that were forming. Buyers and sellers that did not blindly rely on the agents finally had data to help guide their decisions, and I’d like to see some data that shows how these people fared.

My takeaway from this session was that the industry is clamoring for a disruptive service, but its going to be awfully hard to fight the status quo. I think a great service can take off with buyers and sellers, but it will be quickly squashed by the Realtors if it shrinks their commissions. The trick is to create a product for the buyers/sellers, but also make it appeal to the agents. Create value for all parties involved, and it will be a win-win.

The great thing about SXSW is that it breeds ideas. I now have a long list of companies that I’m interested in contacting, ideas for how to make those companies and products better, and ideas that I have not seen any companies doing yet. Thanks for putting on a great confere

I missed most of this session after attending the Groupon breakfast. What I did hear at the end reminded me a lot of what I realized after graduating business school. Most businesses are risk adverse, have been burned by technology before, but are afraid of being left behind. Its easy in retrospect to see the first and last traits play out from business school. Most students came into the MBA program with ideas of where they wanted their careers to go, from start ups to non-profits to the obscure industries, but they eventually took common and safe MBA jobs. Many companies will claim to be on the cutting edge of technology with risky bets, but you can be sure that careful ROI calculations were performed and there is a positive expected outcome. And, once a new technology is proven, companies will rush in to use it. This shows that if you can find the disruptive technology, and prove that it works, it can be a gold mine.

Keynote with Evan Williams

Plenty has already been said about this year’s main SXSW keynote with Evan Williams, the founder and CEO of Twitter. I was probably one of the few people that didn’t mind it. It was not an overly stimulating interview, and I did check my Droid (no, I don’t have an Iphone) quite a few times, but overall Evan provided some insight about his goals and philosophy for Twitter. The problem was that in this forum and with this audience, he needed to go much deeper and provide much more insight.

Accelerator

The rest of the day was spent bouncing between the two Accelerator rooms. I am very intrigued by business competitions, especially after witnessing the quality and dedication that is put in to the Moot Corp finals. The SXSW Accelerator is not close to being on par with Moot Corp, although it is interesting to see what ideas people are taking to market. I was disappointed with the overall selection of companies this year as most seemed to not solve any real problem. My impression was that they were cool ideas for the creators, cheap or easy to implement, and thrown on a website or Iphone app to see if any money could be made. Don’t get me wrong, I am all for the success of companies like this. They make great lifestyle businesses, or can be a quick hit for a short time, if they lead to bigger and better things. However, they do not belong in the finals of the SXSW accelerator. There were a few great companies, but the overall batch brought the level down this year.

Augmenting Maps with Reality

Interesting session that discussed how maps and data will be used in future technologies now that precise location is ubiquitous. Maps are not the interesting parts, but what kind of data will be layered on top of the maps. Two questions that came up: How can maps make people more aware of their surroundings? and how can maps be used for utility? These are the questions that the companies presenting are trying to answer in the products that they create.

Gaming the Crowd: Turning Work into Play

Great session that talked about how nearly anything can be turned into a game, and how beneficial games are for getting routine work accomplished. The session started with examples of some video games that were created to basically make fun of other games. There was the real time marathon, real time driving of a tour bus through the desert, and games that gave awards and achievements for every little thing that was done. Next was Ribbon Hero, a game where you scored points for performing different types of tasks in Word. The takeaway for me was that any task can be turned into a game which people will enjoy playing. The game does not necessarily have to be about a high score, but just a sense of accomplishing all tasks for completeness.

Perfectly Irrational: Who Put the Monkey in the Driver’s Seat? Dan Ariely

I usually am fascinated with psychology, especially when it deal with behavior. Dan Ariely talked about some interesting studies and findings.

-durations does not matter when determining pleasure or pain
-people defer to the default option
-ugly wingmen that look similar to the friend make the friend more attractive
-people value their 1st decisions
-to give into intuition is expensive

Bright and early at 9:30… turned into about 15 minutes late for me. I blame it on that crazy Austin Saturday morning traffic. Wish I had seen the beginning of this, as I missed the talk about crowdsourcing from the user perspective. A big theme was sustainability. Sourcing exists in sprints, it has a definite start and stop, and it can be sustained if people are willing to do that multiple times.

On the business end, there were some creative ways to describe the risks:

Discount Sushi – make sure users will want to come back, not “it was a good idea at the time”.
Football Team vs. Strip Club – must be a team mentality, and an incentive to help others, which will also help yourself
Careless Engagement – do not want to create apathy in user base; quality vs a numbers game
Wasted Neurons – was checking my phone during this slide, but the theme was that a lot of work and effort is wasted
No Contextual Reputation – resumes don’t matter; level playing field

Big Brother in your Brain: Neuroscience and Marketing

Jam packed session, surprising to me. Really cool to hear about some more “harder” science and how it relates to business. This blended closely with behavioral analysis, but is was explained that neuro-marketing is differentiated by figuring out the subconscious reactions that cannot be observed by behavior.

Some facts that interested me: people prefer curves to straight lines (iphone); the brain automatically counts to 3-5, but not higher (for number of products to display); use expressionless faces, the brain does not recognize the emotion so it spends more time on it. Another tip was to have kids do their homework right before bed. This is because the first stage of REM sleep consolidates memories, and school work is better to be consolidated than TV shows.

There was one part that I disagreed with. It was claimed that neuro-marketing identifies which part of an experience is most enjoyable to a subject. For example, this is used to determine what part of eating chips and salsa is most gratifying, which turns out to be the second of anticipation as you bring the chip with salsa to your mouth. The part I disagree with is when he said that music and songs are impossible to identify the exact part of the song that you like. I can think of a number of songs where there is a specific few notes or lines that make the entire song for me. For songs that I marginally like, sure, I don’t know what part of it appeals to me. However, for songs that I really like, I think its easy to identify the portion that makes it.

Playing with Place: Location Based Games and Services

Interesting things going on in this space that do not involve GPS and smartphones… although both of these elements played a big role in this session. A big theme here was to move off of the couch, go outside, explore and be active.

Keynote with Danah Boyd

Missed the first 20 minutes of this due to an extended lunch. Topic was privacy and publicity. Talked about the generational change of older people needed to make an effort to make information public, while today’s kids need to make an effort to make their information private.

From the Kitchen Table to Million $ Business

Conversation style session that talked about some of the issues that start ups have to go through. Good to hear another story on this, but I got no new info from this.

Unsexy & Profitable: Making && Without Hype

Wish I had seen this entire session, just caught the last few minutes. While lots of people are chasing “what’s sexy” and the latest trends, there is lots of money to be made in unsexy businesses. An example was a company that sells just nuts, bolts, and washers, and makes millions. My takeaway is similar to what Mark Cuban said in his session yesterday, recognize when there is a lot of competition in your space and move on. If your claim is that you are faster, better, smarter, etc, you are not unique and there is not much of an opportunity.

How to Unplan Your Business Idea

Good session talking about the usefulness of business plans, for the investor or the entrepreneur, and then tools that people with idea can use to quickly get their business up and running. A woman in the session make an excellent point: ask yourself what you would pay for the product you sell. Better yet, would you buy the product you sell?

There are plenty of other sources that can give you in-depth details of all of the panels and parties at SXSW. I’m going to give you my brief take-aways from the panels that I attended.

Program or Be Programmed: Ten Commandments for a Digital Age Doug Rushkoff

My thoughts were a featured speaker would be a great way to get into SXSW, especially since I was having trouble deciding which panels to attend. I lasted about 20 minutes and did not follow any of this talk. I knew I was in trouble when I did not get his analogy of tripping on acid at an ACDC concert in the parking lot with… whatever he was comparing it to.

Organizational Pitfalls on the Path to Multichannel Experience

I would have gotten much more out of this had I not spent the first half in the other panel. Seemed to be some good discussion, although hard to hear in the back of the room, about communication among different departments within an organization, and how they relate to customers. Also a tinge of Managerial Accounting in the question of which department, online or offline, can claim the sale.

Chasing Virtual Good in the Real World

The co-founder and CEO of Gowalla, Josh Williams, gave this panel. I was excited for this because 1) Gowalla is local to Austin, 2) I’m highly interested in Location Based Services (have been since long before the wide use of GPS), and 3) I was lucky enough to check in and win an Oktomat camera! The Oktomat icon that I found was the first one, so I now have a #1 item in my Gowalla vault.

The talk had parts of ones that Josh has done before, describing his path to Gowalla, but there was one comment that stood out. He’s seen that where there is a number, people want it to go up. Basically saying that competition and game play is innate in many people. Examples included RSS subscribers, Facebook likes, Twitter followers… any number that can be increased, the owner will try to increase it.

Pay TV vs. Internet: The Battle for Your TV Mark Cuban, Avner Ronen

This debate was interrupted a few minutes in with a false fire alarm that emptied the Austin Convention Center. Once it resumed, it was as spirited as I had hoped. I went to this session because I grew up in Pittsburgh, as did Cuban, and I wanted to hear him speak. Hopefully one day he’ll be able to buy the Pirates and put a winning product on the field, but that was not the topic of this session. Mark’s theme that kept coming up was that on the internet, you are one of basically infinite options. Marketing becomes prohibitively expensive in this situation to stand out.

Cubit Planning

Cubit Planning creates software to automate data finding processes for engineers. Their first product is for NEPA documents for city planners, and helps save between 4 and 40 hours of engineering work. The software pulls data from environmental studies and automatically fills out the standard NEPA form in the necessary format.

I think this company can make a big splash in the B2B market, but because they are not consumer oriented, many people will not hear of them. They have targeted the first bowling pin in their market, and perfecting that will lead to more adjacent market sales.

There was a comment regarding targeting the cities to buy the software instead of the engineers. If I were with this company, I would study the government contract bidding process closely in each city, and find out all minute details of the contracts that have been won. Government bidding gets tricky, with cost-plus, no-compete, and other types of contracts, to where the advantages and the buyer of the software might be on different sides of the table in different industries.

FamiGo

FamiGo is focused on providing simple, family oriented games with the hopes of bringing families closer together. Two test games, Dots and Hot Potato, were tested on the Iphone. There were issues of whether they were intending to be a game developer or a platform for distribution.

I don’t think the idea that in selling to a family they’ll automatically sell 3-5 games at a time; families would want a packaged deal available to all their platforms. Also, the barriers to entry are not huge, if they even exist. The founder mentioned that the Iphone app store has over 100,000 developers. If FamiGo gets noticed, there are lots of other competitors. I agree with the commenter that said they’ll need to have one big hit, and that is going to have to be an original game, not an updated game we played as kids.

PetsMD

The WebMD for pets. PetsMD is the go to place for information on pets, with a symptom tracker, medical advice, veterinarian information and appointments, and pharmacy store. Simple idea, not much more to explain.

The comments centered on the idea that the site is not focused. They need to target one customer and revenue stream. I disagree. In the early stage, I’d throw every possible revenue idea out there and see what sticks. The rub is that it all has to be done well, but not necessarily perfect. Once the high revenue sources are discovered, then focus on those. If only one revenue stream is tried, it could be the wrong one, wasting a lot of energy and resources.

Hourville

Hourville is an online marketplace for service providers that charge by the hour. If you provide an hourly service, you can list, manage your calendar, and take payments through Hourville. They have widgets that you can put on sites such as Craigslist that will point customers back to the Hourville site.

This company has been in the Rice business competition, SXSW accelorator, and now Capital Factory. At the SXSW presentation, the panel of judges were not too kind with Hourville, mostly harping on their marketing strategy. They didn’t see a clear goal of breadth vs depth. The final 2 panelists addressed this issue today, but it still is not clear how they plan to attract and retain service providers. I would take the geographic approach, starting in Austin and looking at all types of services. Being in Austin, there is an eclectic mix of services, so the company would get depth and more importantly, learn what it takes to attract each of these different services. That info can scale to other cities, and they could then take on more cities faster. If they just throw their company out there all over the country, they won’t know what it takes to market to bagpipe teachers or belly dance teachers in each city.

Sparefoot (audience choice award winner)

Sparefoot provides a site that allows for search, comparison, and booking of storage space. They have integrated with self storage management software to allow owners to quickly integrate their inventory into Sparefoot’s site. This is vastly different from their original plan of peer-to-peer storage (but they still have this as part of their business model).

I have never searched for storage, but I can imagine the frustration if you can’t quickly comparison shop on price and location. The engine for this will be good, but I do agree with the panelists in that competitors can quickly come into this market and offer the same service. Building a tangible defense is key.

Overall, its interesting to note that potentially 4 out of the 5 companies are building a marketplace, not just creating a product to sell to end users (I don’t include FamiGo because they are not settled on their model yet). When you look at this crop of companies, and other funded start-ups, it seems the shift is moving from, “I can create a cool product that I can sell,” to, “I’m going to be the middle man and make a market more efficient.” It seems as if business has spent many years trying to eliminate the middle man, but in the past few years web 2.0 companies are bringing it back. If they truly do offer efficiencies, then they can work. Companies that use these services will still have to stand out on these platforms, which in time will bring new companies and services (think SEO and SEM for Google rankings).

The session had about 25 attendees, and a good solid mix of presenting and conversation. The basic premise was to discuss lessons learned from my two start up projects, BankOfObama.org and National Event Rental. BankOfObama.org dominated the topics, likely because of its recency and larger reach. We covered Product Design: Timing, Market Research, Development, and Pricing. Next was Product Marketing: Memory, Press/Media, and Grass Roots.

Quick summary:

Timing: make sure your product life cycle is congruent with the expected length of the media coverage of the current event.

Market Research: No time for traditional market research. Instead, use interviews from news, twitter trending topics, etc. to find the thoughts and feelings of customers.

Development: Agile development techniques work well. Quick, open, short development.

Pricing: Aggressive and dynamic. Change price if needed (up or down), and use as many revenue sources as you can. Remember that if you target in general is the United States, and if you have already reached 1,000,000 visitors, there are still over 300,000,000 people that don’t know your product.

Memory: Media and press have already done your branding campaign for you.

Press/Media: Even if you media is calling you, still “sell” your story to ensure coverage.

Grass Roots: Many current events cause groups to spring up. Contact these groups from both the top and bottom to get your message viral.

Other sessions that I attended:

• Roadmaps: The Bridge Between Strategy and Tactics (Byron Workman)
• Anatomy of a Modern Launch – How to Use Internet Marketing Techniques to Launch Your Physical Product (Vicki Flaugher, CEO of SmartWoman Publishing)
• Twitter for Small Business (Chris Sherrod)
• Link Building: Finding Your Most Valuable SEO Link Prospects, Faster and Easier. (Ben Wills, ontolo.com)