Xconomy introduced the Big Apple to the Mobile Madness conference yesterday, bringing together some of New York’s most dynamic innovators in mobile and seasoned investors who back the sector.
And the crowd who attended this half-day forum at the Microsoft Technology Center in Midtown, a stone’s throw away from Radio City Music Hall, got a tour of the ups and downs of building companies in one of the most exciting sectors in digital innovation.
Robby Stein, director of product management at Yahoo, talked about co-founding Stamped—a startup he sold in October to Yahoo. Stein said he built on his prior experience working for Google to create Stamped, whose app let users put stamps of approval on movies, restaurants, and most anything they like then share those recommendations with friends on social networks.
His time developing ideas for Google helped prepare him for the work needed to get his own startup off the ground. “I definitely recommend entrepreneurs have a set of experiences first,” he said. “Obviously some can’t wait.”
Rich Miner of Google Ventures, which backed Stamped, said Stein’s example of learning the ropes from within a company before taking the plunge into entrepreneurship was an interesting change from a common trope of the startup scene. “A lot of people say ‘Oh man, drop out of school, do your startup and I’ll write you a check,’” Miner said. “More and more I’ve heard seasoned entrepreneurs say the foundation they got working for large companies was really helpful.”
Even large companies though can struggle building entrepreneurial ideas. During a conversation among innovators about media and content, Onswipe CEO Jason Baptiste gave a candid dressing down of The Daily, the failed iPad-only digital news app from News Corp.
“We think apps are bullshit when it comes to publishing,” he said. “Nobody is going to download the app and go through thirty-two pages.” Baptiste elaborated by pointing to traffic on websites being driven more by searches, sharing, instant messaging, chats, and links on message boards. “You don’t get that with an app,” he said. “That’s just not possible.”
Onswipe’s platform is used by publishers to make their Web-based content more tablet-friendly with touch screen interactivity. Baptiste expressed his shock at the approach taken with The Daily, confining access to its content behind a pay wall for a tablet-focused app. “I think they sat in a room and said ‘what is the most amount of friction we can add to make this succeed,’” he said.
The mobile sector, as with the overall startup scene, will see its share of duds as the market matures. Concerns about overzealous deals were prominent in Rahul Sood’s mind. Sood, partner with Microsoft’s angel investment incubator Bing Fund, said venture capital seems to be coming in at the seed stage lately in order to get in early on what appear to be bright ideas. Pouring more money into fledgling companies naturally comes with risks. “There’s a shitload of dumb ideas out there,” Sood said. “I’ve seen great submissions and some ridiculous ideas.”
He attributed that mix to the volume of people attempting to create startups, a trend he called unsustainable. “The average number of deals is going up and the size of the deals is going way down,” Sood said. “The quality of the deals is getting a little out of control.” Startups that solve big, meaningful problems, he said, and have “smart money” behind them will be the only companies to survive.
Not everyone though has seen easy money come their way. In a chat with IA Ventures Founder Roger Ehrenberg, PlaceIQ CEO Duncan McCall said he had to be persistent to find funding to build his company. “You have to kiss a lot of frogs,” McCall said. “The stars have to align.”
PlaceIQ analyzes location-based data to determine what is happening based on events and demographics of the people in an area. IA Ventures became a backer of PlaceIQ last year, along with other investors. McCall said he hopes for a fairytale ending after putting in sweat equity to nurture his company and offers some advice in resilience for other entrepreneurs.
“You’re going to have to take a tremendous amount of rejection,” he said. “If you truly believe in something, you can make it happen.”
