Bill Solominsky

I am watching the Capital Factory Demo Day via Ustream this morning. Congrats and good luck to the 5 inaugural companies. Below I listed the company, a brief description of what they do based on their presentation and my best guess, and my thoughts.

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).

This past Saturday I had the pleasure of attending and presenting at ProductCamp Austin. My presentation, “Leveraging Current Events for Product Design and Marketing” was voted as one of the 35 to present out of the 50 that were offered. The voting took place that morning, and the schedule soon followed. I was up right off the bat at 10am, which allowed me to enjoy the rest of the day’s sessions instead of going over my slides in my head all day.

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)