Live Blog: Momentum Summit 2.0

I'm here at the 2nd annual Momentum Summit. Last year I liveblogged and collected a lot of great nuggets from last year's speakers, so I'm doing it again this year.  I'll be updating this at the end of each interview, so keep this refreshed!

Don't forget to look around the rest of Greenhorn Connect if you haven't been here before! Find more great events like this on our calendar, or find a job at a great company in Boston on our job board.

 

Angus Davis, Swipely Cofounder and CEO

Interviewed by

Lee Hower, NextView Ventures Cofounder (Partner)

 

Building a business:

- It's easier to do B2B because you can make more $ per user.

- Consumer ones are more powerful

- Netscape actually worked because they had free consumers, but big businesses paid for services.

"There's never been a better time to start a company."

- Why do people celebrate raising money? No...celebrate $10M in revenue! 

- 3 differences today that make it better (for internet/software co's)

1) Open Source Software = much cheaper to develop software 

- TellMe had to buy software licenses.

2) Ability to rent infrastructure = Like Amazon EC2, etc

- Used to have to buy your own servers...

3) Access to distribution

- If you can't distribute your product, it doesn't matter how good it is.

- You have to be in Top 25 of games on Apple to get distribution

From Lee Hower: "Pivot is just a nice way of saying a near-death experience."

How do you handle competitors? Especially with a lot.

- 4 Steps to the Epiphany by Steve Blank -> Tough read, great content.

- 4 types of markets/opportunities...

- Are you creating something brand new, or trying to compete with something existing.

Swipely's focus:

- Online is only 3% of consumer retail spending.

- Online marketing is $50Bn/yr industry

- Most is focused on trying to get you to buy online (you can only track an online conversion)

- Tracking offline commerce from online ads is a Trillion? dollar opportunity.

The Swipely Story:

- Wanted to track your purchases and have you review your purchase experiences.

- What they learned: people didn't find that compelling

- What was compelling: helping them be able to save money where they shop without loyalty cards and coupons or pay in advance vouchers.

- A few weeks in:  The value prop is really good. People get it and convert 8x better than old idea.

- Now trying to figure out distribution.

- Loyalty is bringing best customers back. 

- Can also help them see how they compare. Swipely is merchants vs. consumers, where Ebay is sellers and buyers.

Make the customer successful and you'll be successful.  Always keep them in mind.

How do you handle the fact that there's so much noise of everyone chasing the restaurants.

- Focus on the value. Go where they're not.  

 

Brian Halligan HubSpot CEO and Cofounder

Interviewed by

Scott Kirsner Boston Globe Columnist

Startup Marketing is Broken

- <insert the stock speech about inbound marketing concepts> 

- Check out "Inbound Marketing" by Dharmesh Shah and Brian Halligan if unfamiliar

- Bottom Line: Create remarkable content. (Remarkable = people talk about it)

What Worked at HubSpot

- Challenged each other to write posts to get into first page of Digg and Reddit

Viral Coefficient = # of Referrals X Conversion Rate.

- If it's not greater than 1, you're not growing virally.

How to actually get a ton of users...check out DropBox's presentation: http://www.slideshare.net/adamsmith1/from-zero-to-a-million-users-dropbox-and-xobni-lessons-learned

HubSpot's social media policy: USE Common Sense

- 85 of 200 employees have blogged

- They rank their blog articles by employee which creates competition.

Getting customers

- Go where your customers are. That's facebook, twitter, etc if your customers are consumers or your customer's customers are (like in HubSpot's case).

Starting HubSpot

- Did two pivots...was LegalSpot and something else before HubSpot 

- Used just an executive summary and 10 powerpoint slides.

3 Questions I wish were asked of Brian Halligan of HubSpot:

1) Explain more about those pivots (LegalSpot?) before Hubspot and how you got there.

2) Talk about how phone calls and outbound marketing fit into what HubSpot does that is started by their inbound marketing.

3) How do you handle building a company culture...HubSpot seems Sales/Marketing driven but your fundraise alluded to wanting to be more Product driven.

 

 

Ric Fulop A123 Systems Cofounder (now at North Bridge Venture Partners)

Interviewed by

Eric Paley, Founder Collective Managing Partner

 

Getting Started:

 - Toyota said it takes 5 years to get a deal with them and that they don't do deals with 5 person companies.

- So they went after power tools....got a great deal with Black and Decker

- You have to have a MUCH BETTER product to stand out as a small company against a giant; A123 was competing against SONY.

- Small Teams should focus on the least amount of stuff possible. Outsource everything.

- The only thing A123 did was design the product. They used partners in Asia to make it work.

What do you do after your first big deal?

- It took just as long to close a large deal as a small, so they targetted a new vertical.

- Asked themselves, "We want to get into vehicles. Who would be an early adopter?"

- Went after some aerospace companies that would try sooner.

- Used data from the lab to leverage what you're better at to beat competition.

- Heavy automotive market is dominated by A123 (75% market share)

Foundation:  3 Founders

- Professor at MIT, one other technical person and Ric.

- Until you hit the product being ready, you need a lot more engineers. Once you have a product, you'll need a lot more Business Development roles.

Fundraising:  A123 raised $350 Million 

- Once you can't outsource everything anymore, you need money to build it all yourself.

 

Christopher Ahlberg, Recorded Future CEO  &  Founder

Interviewed by

Eric Paley, Founder Collective Managing Partner

 

How do you find Product Market Fit?

- You start with a Market (A)  or Technology (B)

- Chris tried going to the white board...

...sorry. Didn't have anything I could easily take notes on.

 

 

David Friend, Carbonite CEO & Cofounder

Interviewed by

Maria Cirino, .406 Ventures Managing Director

 

Origin:

- Idea came from their own problem: daughter lost term paper on a laptop.

- Started looking for simple solutions to back things up.

- Did back of napkin math to realize price of storage was starting to drop to the point a year later they'd be able to do backup for the cost of a cup of coffee. They also figured it would take about a year to code, so they got started.

David has founded many companies with the same guy (Jeff):

- What's made it work: Good separation of responsibilities

- Jeff takes care of internal duties, David handles external

- David tries to articulate a consistent vision for the company so everyone knows where they're headed.  He shares it with the world then too. ...and raises money.

When did you know this would be big?

- They did a bunch of surveys and analysis and the end of the report said, "this is going to be big if you can make it easy enough." The guy that did the survey even asked for a job (he's now VP of Marketing).

Building the company:

- Been doubling in size every year since 2006

- Have to do a lot of hiring and firing, especially in sales

- Get the money machine going: put a dollar in the top and see how much money comes out the bottom.

What are your top concerns now?

- Brand recognition is huge to build trust.

- 1/3rd of their customers don't know what right-click buttons does; trust is not built talking about encryption, it's them trusting your brand. Hence, the advertising on NPR and Wall Street Journal is important. 

- Scaling is a big challenge too. The get hundreds of millions of bytes a day.

Raising money for Carbonite:

- Didn't think Boston VCs had the right mindset so got a hotel in the Valley and walked up and down Sand Hill Road making pitches until they closed the money they needed.

- Have raised $63M in 4 rounds. David thinks they're done raising institutional money.

- Didn't raise from past funders because past companies were enterprise.

- Venture presentation: simple slide deck - if they're not excited by your slide deck, a business plan is not going to help.

Biggest Challenge:

- Be prepared for something to break every day. It's important to have good people who can handle solving problems. 

How Carbonite is Winning:

- Carbonite has 10X fewer engineers than other companies per Terabyte of data stored.

- Has better brand awareness than any competitor...and they're the cheapest.  That's tough to beat.

- When there's mistakes, fess up, apologize and let it die down.

How do you make product decisions to keep it simple but always improving?

- They have a big usability lab at Carbonite, so they constantly test both current customers and non-users.

- The customer is right. If they can't see it, you have to fix it.

 

Paul English, Kayak CTO & Cofounder

Interviewed by

Jeff Bussgang, Flybridge Capital General Partner

 

Meetings:

- Go for "next day"; the immediacy builds momentum

- If you have someone in a meeting for a new candidate, give them veto power or don't waste their time being there.

Hiring:

- Paul looks for 4 things:

1) Bandwidth capabilities

2) Attitude

3) Diversity of Success (have done many different things)

4) Lack of Dysfunction (similar to No Asshole rule)

Bonus: If you don't smile and make eye contact in the hallway, then you're a net loss on company energy.

Building the company:

- 2 product plans: 30 plans, and 90 plans

- 1 annual financial plan

- Deploy once a week.

- Goal: 2% the size of competition and $2M in revenue per employee.

- Mix of people with 20 years experience and straight out of school.

How do you handle the interrupt driven culture of today:

- Focus on your plans and goals. Don't let it distract you.

Goal Setting:

- Each time you reach a milestone, set the bar higher.

- Pick goals that are a little higher than you think you can get, then crush it. Once your confidence is higher, set the bar higher.

Advice to a Graduate:

- Who are the 3 people I want to work with everyday. Which team of 3 is strongest? Go work for them

- Pick people you want to hang out with, you think you can learn from and who you think you could work with for a long time (multiple startups?).

On Firing:

- Be world class in firing is important to be a successful startup.

- Still feel painful to fire people.

- Kayak tries to be really nice. Help them find jobs, land on their feet. Not personal, it's usually a fit issue.

- When you do a firing, talk to the employees that are still around. Talk to them about their concerns and cement your pledge to build a great company. Create a "Culture of Excellence", which must be authentic from the top down.

Commitment to every employee on Kayak:

1) Get them to agree before you make the financial offer

2) To things you promise A) Be the best at your role B) Be a net energy gain

3) Paul's promise A) This will be fun B) you'll be surrounded with other great people

- Advice from Jeff: Be very direct with expectations and open with this discussion

- Advice from Jeff: Be open and honest about your strengths & weaknesses and set a good example as a leader and that trickles down to your company.

- Paul once made a list of his 3 strengths and 10 weaknesses to set expectations for his boss. It's a healthy exercise.

Engineering Support:

- Kayak has a patent on this solution.

- They wouldn't log onto a console.

- Send an email and there's a system to see if someone else responded.

- If you last handled a customer, you work with them again.

- If there's an explitive in the email, it goes straight to Paul so he can deal with them. He loves passionate customers and trying to turn them to happy customers.

- Advice from Jeff: Scott of Shoebuy gets every customer support email as well as engineers, so he leads by example. 

On Customer Interaction:

- Find the best listeners and those that don't bring their own agenda.

- Find people that don't lead the customer.

- Don't try to do real time interpretation

Management Culture:

- It's hard to hire in management, because they're fighting to get buy in.

- If you bring in new management, have them hire 3 new people who will instantly be loyal.

- If you can learn to let people make mistakes, those are who quickly climb to VP level roles.