Y Combinator's August 2008 Demo Day in Cambridge

Here are the three things that hit me hardest about today's Y Combinator Demo Day in Cambridge.

1. The Boston VC community has finally woken up to this event, and the promise (and engineering skillz) that many of the YC start-ups show. Represented in the audience today were Matrix, Sigma, Kepha Partners, Spark Capital, and a zillion others -- many of whom weren't present last August. General Catalyst sent at least three folks, including co-founder Joel Cutler. More conspicuous this year were the VC firms who didn't sent a partner or associate, like Polaris, Prism, Highland, North Bridge, and some alleged early-stage funds like .406 Ventures and DACE Ventures.

2. Many of the start-ups were focused on radically simplifying the sign-up process to use a new Web service, or set up a new blog or Web page. I found myself wondering, "When will a YC start-up figure out how to enable me to join a new service before I've even heard of it?" Maybe in the Spring 09 crop...

3. I think Paul Graham is the Schumpeter of the 21st century. Every start-up seemed to be trying to destroy (or at least improve upon) something that has been around for a couple years....including Evite, Monster.com, Reddit, Blogger, existing digital photo frames, and Tumblr. That's a good thing, but it was funny to hear Posterous, the first start-up to present, diss Tumblr with Tumblr investors (two guys from Spark) in the audience.

Here's the video I shot at the event, followed by some notes on all of the non-stealth companies that demoed. (Video includes TicketStumbler, Fliggo, Picwing, MeetCast, CO2Stats, Job Alchemist, Slinkset, Frogmetrics, Anyvite, Popcuts, Snipd, and Ididwork -- though not in that order. There's also a brief cameo from John Puskarich, co-founder of Bountii -- a Y Combinator alum.)



- Posterous was first out of the gate, and impressed a lot of people. A slick, simple way to start and maintain a blog using only your phone (or any device that can send an e-mail). Handles photos, MP3s, and video really well. Great company name, too. Already covered by TechCrunch and VentureBeat.

- TicketStumbler is, simply, Kayak for sports tickets, searching lots of sites across the Web and then helping you sort the options, for instance, that exist for seeing the Red Sox game. (Where do you want to sit, and how much do you want to pay?) Covered by TechCrunch here. They say they are already profitable.

- Fliggo runs an existing video-sharing community ... planning to introduce something new soon, geared to people who're dissatisfied with YouTube. A bit more about what they're up to is in the video, above.

- Picwing is trying to do for photo frames what Apple did for MP3 players... marry nicely-designed hardware with easy-to-use software. Frame is $249, and has a Linux computer inside. Their demo involved shooting a (blurry) pic of the audience and then having it appear a few seconds later on the frame. Neat! The somewhat cyncial VC next to me seemed ready to place his order.

- MeetCast: trying to make Web conferencing simpler than WebEx yet more sophisticated than Tokbox. Start a conference in a few seconds... invite people to call in or participate via video... or share presentations or docs from their desktops. This was one of those apps that you really want to get your hands on to see if it's actually as easy-to-use as the demo made it seem.

- CO2Stats felt like the most mature start-up of the bunch. And they have an actual business model that involves people paying money for a valuable service, not simply placing "targeted ads" on Web pages, or hoping someone will buy them before it becomes obvious they can't produce revenue. They certify that a Web site is run with green power, and will actually sell the site renewable energy credits to offset the site's carbon footprint. Already profitable, apparently the early leader in its space, and just signed IBM as a customer. I suspect they will be acquired before 2008 is out...

- Youlicit: Trying to best Mahalo and Squidoo by using algorithms rather than human editors to create guides to a given topic (like "picking up girls".) The results are similar to the topical directories that humans built for Yahoo in the mid 1990s. Maybe Yahoo should throw everything away and simply buy Youlicit? They'd hardly have to change the ticker symbol...

- Job Alchemist: Helping blog publishers make more money by putting targeted job listings on their sites... and collecting a bounty when a candidate gets the job. Also makes setting up niche job boards easier. Can't wait to try this.

- Create Digg-like rating systems, or votable lists, in a few minutes with Slinkset. Another thing I need to tinker with for InnoEco.com.

- Frogmetrics uses Nokia N810 devices (about $350 each) to collect survey data from consumers after they've engaged in transactions. Six employees.... they say they're already profitable... and just landed a Fortune 150 client. They say their survey response rates are better than 90 percent... and that they use the N810 because they think people are less likely to swipe it than an iPod touch, which is cheaper. Establishments can collect e-mail addresses from their customers, and also analyze how people rate individual employees or product quality at a particular time of the week. Like, does a restaurant's food get bad ratings on Sunday night, but great ones on Monday? They've been testing it in two Cambridge restaurants, which they wouldn't name.

- Anyvite is yet another Evite-killer. Focused in part on making invitations easy to create and respond to on mobile phones. Covered here on TechCrunch.

- Snipd is doing content-sharing/social bookmarking, with a focus on honing in on specific passages of an article, or segments of a video, that users find most interesting. That lets other users hone in on the "hot zones" of a video -- the part that other users found most compelling.

- Ididwork allows employees to track what they've accomplished, and publish it to a Facebook-style feed page. Managers can also use the system to review employees, giving them more frequent feedback than the quarterly review. Already profiled on TechCrunch.

- Backtype wants to be Google for comments, hunting down blog comments and making them searchable and trackable (so you could track all of my comment posts across any site, or create alerts about a given company that may be mentioned in comments.)

- Popcuts is a bit like the music site AmieStreet, except they reward people who purchase music early (and presumably tell their friends about it) by giving them a cut of future sales. If a song takes off, not only could you have the 99 cent purchase price refunded, but you could earn a return for being a "taste-maker."

A few other presenters are still in stealth mode, and we were asked to leave their presentations off-the-record. We'll see if folks do that...

Here are some of the people I saw in attendance:

David Beisel of Venrock, Don Dodge of Microsoft, Bijan Sabet and Rob Go of Spark Capital, Jeff Yolen of Sphere, Saar Gur from the California office of Charles River Ventures, Steve McCormack from Commonwealth Capital, Margaret Lawrence from Pilot House Ventures, Matt Witheiler from Flybridge, Tali Rappaport from Matrix, David Baum from Stage 1 Ventures, Jonathan Golden from Greylock, Jonathan Seelig from Akamai, Bill Warner of Warner Research, David Hornik from August Capital, Rich Levandov from Avalon, Neil Sequiera, David Orfao, and Joel Cutler from General Catalyst, Matt Hjerpe from Atlas, Jeff Glass from Bain Capital Ventures, Roger Krakoff from Sigma, Fred Wilson from Union Square, Dharmesh Shah from HubSpot, and Jo Tango from Kepha.

Also saw John Puskarich from the shopping search site Bountii, a Y Combinator graduate from a previous class. They've gotten some angel funding. John, an MIT alum, has been working in Cambridge, with his co-founder Samir Meghani in the Bay Area. Sadly, John told me today he's heading west soon to keep building the company out there.

We'll see if some Boston investors put money into this summer's batch of start-ups...and maybe keep them around the neighborhood. So far, Bijan Sabet of Spark is the one Boston-area VC to put money into a YC company, I'm In Like With You, which is actually based in NYC.

Here's some previous InnoEco coverage of Y Combinator and video with Paul Graham.

March 08 Demo Day at Y Combinator, Mountain View

I stopped by the Y Combinator Demo Day in Mountain View this afternoon… and caught about two-thirds of the demos. (I was running late, driving up from Carmel.) This was my second time at one of the firm’s Demo Days. Last time was August, in Cambridge.

The first thing that struck me was the quality of the crowd. In addition to the usual VCs (Greylock, Matrix Partners, Charles River Ventures), the room was filled with the likes of angel investor Ron Conway, Lotus founder Mitch Kapor, HotorNot co-founder James Hong, Dave McClure of 500 Hats, and VentureBeat founder Matt Marshall.

Second thing was the quality of the demos. They’re limited in time (seven minutes?), and so the entrepreneurs don’t feel obligated (nor do they have time) to explain every feature of their product, or talk in comically vague terms about all the potential partnerships they’re pursuing. Basically, they offer some context: who they are competing with, who has tried something similar before. What does the service do now, and what might it be able to do in the future? That’s all.

(I’m a big fan of seeing how entrepreneurs respond to questions, so I suggested afterward to Y Combinator partner Jessica Livingston that one question from the audience per demo might not slow the pace too much…especially if the answer had to be given in one minute or less.)

From a Boston perspective (the lens through which I see the world these days), a couple things were interesting…

First is that Y Combinator works with two classes of start-ups each year – a summer crop in Cambridge, and a winter crop in Mountain View. The Cambridge crop presents their demos in Cambridge, and then flies out west to present again in California. But the Mountain View crop presents twice in California (no trip east for them.) The first presentation, apparently, is to people who’ve previously invested in Y Combinator companies. Today was the second presentation.

Livingston told me that of the 60 start-ups that have been through the program, only two have decided to stay rooted in the Boston area: Tsumobi and Bountii. (She wasn’t counting the 20 start-ups in the current crop.)

Two start-ups in this Y Combinator class had Boston roots, and both plan to try to make a go of things here in the Valley.

One is Tipjoy, founded by Ivan and Abby Kirigin, who previously worked at iRobot and Nokia. They quit their jobs late last year to develop their idea – an easier way for fans of Web content (whether music, blogs, or videos) to leave a tiny monetary tip… like 10 or 20 cents… as a thank-you for creators of content they enjoy.

The Kirigins still have a house in Arlington, but they’re planning to extend their lease here in the Valley for six months, to see what happens. “This is where 90 percent of the funding is,” Abby told me. “There are more angels in Silicon Valley, because you have lots of people leaving larger companies with money to spend time investing,” Ivan said.

The other is Kirkland North , which is developing a game called Turf, played both online and in the real world. The game started at Yale, spread to Harvard, and is being rolled out to more schools by a small team that includes three ’07 Harvard grads. Co-founders Matthew O’Brien, Andrew Fong, and Hugo Van Vuuren met while living (and playing Halo together) in Quincy House.

O’Brien was far from subtle in making the comparisons to Facebook, noting that Turf had spread among Harvard undergrads even more quickly than Facebook. “We’re not trying to be as big as Facebook,” he said. “We’d be happy to be 1/15th as big as Facebook.” (An allusion to the company’s $15 billion valuation.)

Some other cool ideas from today’s batch of demos:

Wundrbar is a tool bar that tries to anticipate tasks that you want to do (like booking a flight or adding an event to your calendar), and bring them into a single page through clever use of APIs.

Chatterous lets you initiate conversations with your friends through their preferred mode of communication: IM, e-mail, SMS, etc.

Webmynd creates a visual record of your Web browsing history that can be easily navigated… so that without creating scads of bookmarks, you can go back and find stuff that’s relevant to you.

Omnisio lets you annotate, tag, and comment on videos from any video site, and also edit highlights out of longer videos.

'Founders at Work: Stories of Startups' Early Days'

Just finished reading Jessica Livingston's 'Founders at Work' over the weekend. It's a compilation of interviews with enterpreneurs -- many of them from the Boston area.

So few books are published that deal with building companies here...and Jessica gets into the nitty-gritty: relationships with co-founders, negotiations with VCs, competing with bigger players.

The Boston entrepreneurs interviewed in the book include:

- Dan Bricklin, Software Arts (VisiCalc spreadsheet)
- Mitchell Kapor, Lotus Development Corp.
- Ray Ozzie, Groove Networks (Ray is now chief software architect of Microsoft)
- Paul Graham, Viaweb (Graham went on to start Y Combinator, the early stage venture firm in Cambridge, where Livingston works)
- Philip Greenspun, ArsDigita (now a blogger and flight instructor)
- Stephen Kaufer, TripAdvisor
- Ron Gruner, Alliant Computer Systems and Shareholder.com
- James Currier, Tickle (Tickle was founded in Boston as Emode, and then moved out to San Francisco before being acquired by Monster.com)
- Bob Davis, Lycos (now a VC at Highland Capital Partners in Lexington)

Amazingly, there's a blurb on the back cover from Bill Kaiser of the venture firm Greylock Partners, which was involved in a very public battle with ArsDigita founder Philip Greenspun (it's recounted in Greenspun's chapter, in piquant detail)

Demo Day at Y Combinator

I'd heard lots of great things about Y Combinator, a seed funding firm that operates a kind of summer camp for start-ups. And their Cambridge office is right down the street from me, near Huron Village. (Here's a Newsweek story and a USA Today piece about them.)

Today was their "demo day," when the start-ups they help cultivate show off what they've built. Y Combinator partner Jessica Livingston was kind enough to extend an invitation, though some of the event was off-the-record. (Jessica is the author of 'Founders at Work,' a really wonderful collection of entrepreneur interviews.)

So this was my first chance to see what Y Combinator actually does.

The good news first.

The audience was amazing: VCs from Matrix, General Catalyst, Atlas Venture, North Bridge, Fidelity Ventures, and Venrock. VC bloggers Fred Wilson and David Hornik. Execs from Microsoft and Google. Avid Technology founder Bill Warner was in the front row.

The start-ups were equally amazing: nineteen of them, all with working demos, all with really great presentation skills. Many of the demos were funny; Fauxto's demo involved turning Steve Ballmer's eyes green, and superimposing the Google logo on his forehead. Dropbox, which hasn't yet launched, made subtle and snarky references to dot-com flame-outs from the late 1990s (like GovWorks, Flooz.com, and Kozmo) during its demo of an online storage service.

Now the bad news... several of the enterpreneurs I talked to who have connections to the Boston area are planning to move their companies out west. The Y Combinator network is perceived to be stronger out in the Valley (the firm does a winter program in Mountain View). The VCs more adventurous. The partnership opportunities more plentiful. The potential for generating buzz better.

Is it hopeless to think about trying to change some of these dynamics?

(Here's Don Dodge's post about the event.)