Nov
20
14



What It Takes: Qualities of a Successful Founding CEO

Which is more important: The idea for a startup or the qualities of its founder? I am increasingly convinced that the founder is the most important ingredient for success. Of course, the idea is important; it has to be and compelling enough to warrant the gajillion hours it takes to build a meaningful business. But in the end, if you don’t have someone at the helm who can figure out what it takes to win a market or evolve as circumstances warrant, then you simply can’t succeed.

There are three key qualities I look for when mulling whether to back a founding CEO and these have served as the most accurate predictors of whether someone will be a great founder. I look for them every time I consider a deal and almost never get to ‘yes’ without seeing at least some combination of them. They are neither exhaustive nor non-negotiable, though they are key to the decision-making process around funding. So, in no particular order, here they are:

Up Close, First-Hand Knowledge and Understanding of the Opportunity

There is almost nothing better than a pitch that begins with a founder citing that a-ha moment, when he or she noticed a problem in a prior work role and realized that there was a big market opportunity if only if someone could solve it. This kind of real-time epiphany turns what might be just a good guess from another would-be entrepreneur into a tangible, actionable opportunity for someone who has the deep insights into what needs to be done to solve the problem and create a new market. What’s more, thanks to the experience gleaned from being in the right place at the right time, this kind of founder usually finds that he or she is uniquely qualified to go after the opportunity. They have lived the problem and therefore have a deep conviction about what to do. More than that, they have developed a passion about the proposed pursuit, which typically gives them the push needed to strike out on their own.

This is what convinced us to back Anil Kamath, the founder of Efficient Frontier. His pitch combined an impressive pedigree–he has a PhD in computer science from Stanford– with a definable ah-ha moment. Early in his career, Anil designed program trading models for the D.E. Shaw & Co. hedge fund. From there, he started a search-engine company that helped consumers compare products from different shopping sites. It was bought by Shopzilla. It was at Shopzilla that Anil realized the importance of search in driving web traffic. Since he had already designed systems for millions of stocks at Shaw, Anil figured he could build a system for millions of keywords and other Internet advertising tools that would be useful to anyone involved in ecommerce. Anil’s insight was what eventually led to the leading platform for digital media optimization, which was acquired by Adobe.

Unbridled Passion that Translates into Visionary Salesmanship

Before you start rolling your eyes, I’m not talking about the slick, transactional version of salesmanship–the form that is typically embodied in a successful sales exec that delivers against his quota from company to company. I’m talking about the person whose enthusiasm and conviction for an idea is so palpable that it’s almost infectious. This enthusiasm is deep-rooted, earnest and genuine, meaning he or she can harness it to convince anyone within earshot about the sheer brilliance of the endeavor being pursued. Let’s face it: You can’t fake what it takes to sell a vision, especially when you are repeatedly pitching everyone from business partners to employees to investors to customers or to anyone else who might be part of the solution.

Case in point: Omar Tawakol, founder and CEO of BlueKai. Finding an entrepreneur and leader like Omar is like winning the trifecta. He has extraordinary technical chops with CS degrees from MIT and Stanford. At the same time, he’s a natural marketer, having served as CMO at two previous startups. These two talents, combined with a deep appreciation for the importance of audience targeting in digital media gleaned from a previous role at Revenue Science, make Omar one of the most effective salesman I have ever met. He moves effortlessly from explaining the strategic potential his offerings have for the customer to the minute technical details of the implementation. Like Tom Cruise in Jerry Maguire, Omar has you at hello.

Virgin Founders

The last and possibly most important quality I look for in a founder is that he or she hasn’t done it before. Yep, I like newbies, albeit with a few important caveats. I don’t want an inexperienced first-timer. I am much more partial to someone who has been part of a successful team or played a meaningful role at a promising startup. But they were not the one who made it all happen. Instead, when you reference this person, you hear things like “always the hardest working or smartest one in the room,” “kept getting more and more responsibilities ahead of others,” or “hasn’t been a CEO yet but undoubtedly will do it someday.”

These virgin founders are recognized up-and-comers, hungry to take the next step in their professional paths. They are also sufficiently naive and don’t realize how hard building a successful startup actually is. Most first-time entrepreneurs dramatically underestimate the obstacles they will face. Lastly, these people usually have not yet “made it.” They don’t have a sizable nest egg from a previous exit, or the promise of another plum assignment if this one doesn’t pan out. These folks need their startup to succeed.

I can think of no one who fits this bill better than Mike Walrath at Right Media. Here is a guy with as unconventional a path to tech stardom as you can find. He started out as a personal fitness trainer who also sold gym memberships. He jumped to Doubleclick in a hiring blitz just before the dot-com bubble burst. As most folks received pink slips, Mike earned promotion after promotion. When he finally came up with the concept for Right Media, his Doubleclick boss was the first to confirm that Mike had what it takes to launch and lead a startup. He said he had always been the hardest working and smartest guy in the room. And he was hungry to prove it. Plus, he was obviously a strong salesman with a compelling vision. You can’t ask for much more than that.

We can all agree that startups are tough. But I have observed that founders with one or more of these qualities are even tougher. They are undaunted by the endless stream of naysayers who tell them their ideas will never work, that they will be crushed by the competition, or that better, more experienced players have already tried and failed to execute similar business plans. These are the winners, the over-believers who can overcome almost any roadblock in their way–and come out on the other side with an unmitigated success story.


Nov
4
14



Riffsy and the Business of GIFs

Today we are excited to announce we’re leading an investment in Riffsy backing strong entrepreneurs like David McIntosh and Erick Hachenburg.  We are proud to partner and work toward their mission to improve communication, helping people express themselves.

There has been a tremendous rise of communication apps in our now mobile world.  Riffsy enables frictionless sharing of animated GIFs and nano (extremely short form) media.  Beyond flat text or static images, animated GIFs allow users to perfectly express a feeling, emotion or moment.

Enabled by the release of iOS8 and the inclusion of custom keyboards, Riffsy launched the GIF Keyboard to tremendous consumer adoption.  With more than half a billion animated GIF views from greater than one million downloads immediately out the gate, Riffsy has tapped into a consumer need.

Instagram demonstrated a picture is worth a thousand words. Riffsy enables sharing emotion which in some cases transcends words.

Download the GIF Keyboard and prepare to have your …


Oct
23
14



How I Learned to Stop Circling and Love to Park in San Francisco

Today LuxeValet is launching out of beta in San Francisco and we are excited to announce our investment in the team. We are proud to back founders Curtis Lee and Craig Martin on their mission to transform a daily, painful experience like parking into one that gives people joy by letting them quickly and safely leave their car and get on with their day.

We were impressed by LuxeValet’s veteran team who saw an opportunity to transform the $25B annual parking business with an on-demand, valet-driven model. The team brings engineering, product and operations experience from Zynga, Groupon, Tesla and YouTube and has developed a sophisticated platform that makes the city parking process easy, efficient and affordable.

The parking problem in San Francisco, as with most cities, is awful by any measure.  The median price to park in a San Francisco city lot is $29/day and $375/month. In some neighborhoods, parking meters charge as much as $7/hour during periods of high-demand. Last year, 70,000 cars were towed in San Francisco and it costs at least $400 to get a car back. Instead of dealing with that hassle and cost, at the press of a button, a LuxeValet will meet you in front of your next meeting to take your car and park it in one of their secure spots for $5/hour and $15 max.

The LuxeValet team has been building the technical and operational foundation of the company for the past 18 months. LuxeValet has a fleet of pre-screened valets in bright blue jackets and dozens of insured and secure indoor parking lots all over the city. This allows them to deliver a great consumer experience at the push of a button. The valet experience also allows them to deliver one of my favorite features which is the LuxeValet will fill up or wash your car while you spend time with your family or attend your meeting.

Even more interesting are the economic advantages that happen to the model at scale. By obtaining parking spots en masse, LuxeValet brings down the price of spaces, making it the same cost and many times less than a traditional lot, while delivering a much better experience. Like most marketplaces this also has great network effects: more users mean keeping more valets busy, which means the valets make more. More riders mean more parking spots and lowered costs for the spots themselves.

We love these type of marketplace investments that reward each player in the virtuous cycle and are perpetuated by an amazing consumer experience.

Congratulations to the entire Luxe team from your friends at Redpoint.  We’re excited to be along for the ride.


Oct
21
14



Backing Snowflake: Proven Leadership with the Right Technology at the Right Time

Today Redpoint portfolio company Snowflake Computing is introducing their Elastic Data Warehouse, a highly scalable data warehouse purpose-built for the cloud.  We believe the market opportunity for Snowflake to reinvent the SQL data warehouse for the cloud is enormous and transformative.

Data warehousing is a $9 billion business that is in the early days of discovering the cloud.  Our thesis is that the investment into business intelligence tools for unstructured data has overshadowed the biggest untapped void in data analytics. Snowflake is changing the game by making data warehousing accessible to everyone by designing a new data warehouse built from scratch in utilizing low cost but highly available cloud resources.

Snowflake today introduced their Elastic Data Warehouse, which brings an innovative and patent-pending architecture to convene all users, data and workloads into a single SQL data warehouse. It gives users the power of SQL data warehousing with the flexibility of big data platforms and the elasticity of the cloud—at a fraction of the cost of on-premises solutions.

Lead by seasoned executive, Bob Muglia, Snowflake’s truly impressive team that shares a vision and a mission to disrupt the inefficient ways of data warehousing.  We are impressed with the deep technology bench at Snowflake, data scientists from companies like Oracle, Microsoft, Cloudera and Google, who hold over 120 patents in databases and data processing.

To Bob and the entire Snowflake team, thank you for partnering with us and welcome to the Redpoint family!


Sep
25
14



Building brands, talent and world class companies here at Redpoint

I’m excited to welcome two new hires to Redpoint to boost our overall bench strength and serve as strategic resources to our portfolio companies. Hadley Wilkins will be leading Marketing for us and Amy Knapp will head up Talent. Between them, Amy and Hadley have a combined thirty-plus years of experience in the Valley leading marketing and talent initiatives for a range of emerging and established enterprise and consumer technology companies.

These are important additions to Redpoint. Throughout its fifteen-year history, our firm has observed firsthand how vital marketing and talent are to separating the good from the great. These strategic elements are also two of the hardest to get right. That is why in addition to helping on firm-wide initiatives, Amy and Hadley will also be resources to our founders and their startups at key moments in time. They will be able to offer everything from strategic counsel to introductions to their marketing, media and talent networks.

Both women bring with them a wealth of exceptional experience, which is why we are committing now to expanding our firm’s capabilities. Hadley, most recently, ran the technology practice for global PR firm Hill + Knowlton, a leadership role that built on the many years she spent defining brands and developing strategic messaging campaigns. Amy brings with her 17 years of talent acquisition and human resource expertise. For the last seven years, she spearheaded efforts to define, grow and execute talent programs at Google, Ning, and, most recently, Chegg.

It is no easy feat to find the right people to grow your team. At Redpoint, we believe we have. Welcome Hadley and Amy to the Redpoint team!


Sep
17
14



There’s a Dragon at the Door

All eyes are focused this week on Alibaba. The Chinese-based ecommerce powerhouse will make its debut as the largest technology initial public offering in history. By the time of the closing bell on its first day of trading, Alibaba could be the fifth most valuable Internet company in the world, sandwiched tightly between fellow behemoths Facebook and Amazon.

This is big news in and of itself. But Alibaba’s IPO is just one of many factors that, taken together, should be viewed as a wake-up call for U.S. tech companies. China is on the move, no longer satisfied by winning in its own markets. The technology landscape from Shanghai to Beijing has shifted and now boasts enough money, talent and entrepreneurial zeal to rival the U.S. establishment in marketplaces around the globe. To think otherwise is naïve, shortsighted –and potentially very costly.

In a recent letter to investors, Alibaba’s charismatic Executive Chairman, Jack Ma, was unequivocal. He wrote: “In the past decade, we measured ourselves by how much we changed China. In the future, we will be judged by how much progress we bring to the world.”

Looking around at what is already unfolding, I believe him.

As of a week ago, about a third of the top 20 Internet companies in the world with the highest market capitalizations are Chinese based. This includes Tencent, Baidu, Qihoo360 and others that are lesser known in the West. These companies are aggressive and nimble. They are also innovative, moving away from copying what they see succeed in the U.S. to blazing their own business models that we are now looking to imitate. Tencent, for example, is envied as the global leader successfully selling virtual goods at scale. The company has also racked up huge market share by using free games to lure customers to its apps stores and other services—a strategy Microsoft appears to be adopting with its purchase this week of Mojang AB, the Swedish maker of the wildly popular Minecraft series.

This growing confidence is thanks, in part, to a flourishing community of well-educated entrepreneurs. Many of these folks are as good as any found in the U.S. They are willing to take risk, are relentless in their drive to win, and are immensely hard-working. Even China’s government has had to acknowledge their burgeoning power and contributions to the overall economy. The Ministry of Commerce acknowledged in 2013 that entrepreneurial ventures now account for 75 percent of new jobs annually. No surprise, then, that China is taking steps to make the starting of companies easier and less costly.

Beyond the revving of this Silicon Valley-style creative engine, Chinese Internet companies are moving in ways that make clear their aspirations to be dominant global brands. They are investing their considerable cash more aggressively than ever, particularly in the U.S. In just the last two years, Alibaba and Tencent alone have put big money into 13 U.S.-based early stage companies. Most of the startups have been in the mobile or e-commerce spaces, including Snapchat, Lyft, Tango, Whisper and Kabam. This is in addition to countless other smaller infusions of capital in other enterprises. The Chinese tech giants are also establishing serious outposts in the U.S. and in other markets, like Latin America. It is only a matter of time before we will see important, sizable, brand name acquisitions of U.S.-based tech companies.

The bottom line is that U.S. tech companies should worry as much about what the technology giants in China are doing as they do about Google, Twitter, Amazon or Facebook. WhatsApp, acquired by Facebook earlier this year, is the world’s leading messaging application with 600 million monthly active users. But Tencent’s WeChat is a competing product that draws on some of the lessons learned by WhatsApp, Instagram and others. It offers a unified messaging app that embodies a combination of Facebook, Instagram, Twitter, Viber and Paypal in a single experience. In a very short time, WeChat already boasts almost 450 million monthly active users worldwide. And it has only begun to tap into markets outside of China.

The writing is on the wall. Alibaba’s IPO, while an important milestone, represents much more than just a big day on Wall Street. It is a coming out party for one of the most valuable Internet companies in the world—and a slew of other ambitious China-based players. They may be thousands of miles and multiple times zones away. But make no mistake: They are already at our doorstep.

 

Published on LinkedIn 9/17/14


Sep
5
14



Beepi expands to Los Angeles and Launches “Beepi Prime”

Beepi, the leading peer-to-peer marketplace to buy and sell pre-owned cars online, today announced it is expanding services beyond the Bay Area for sellers, and outside of California for buyers.

While Los Angeles residents have been able to purchase cars through Beepi, they will now be able to seamlessly sell their vehicles online as well. In response to high consumer demand, L.A. sellers will be able to easily schedule an appointment to have their cars inspected and Beepi-certified right in their driveways or at their places of business, get professional car photos taken and receive a guaranteed price and sale in 30-days.

In addition to this expansion, the company is launching Beepi Prime, a premium delivery service, in 140 cities in Arizona, Nevada and Oregon. There, buyers can now take advantage of the same customized service Californians have enjoyed since Beepi’s launch in April. Beepi Prime gives buyers an unparalleled personalized shipping experience in which they are updated about the status of their car every step of the way, culminating in the delivery of a fully detailed car in their driveway in five days or less and a personal car tour from a professional Beepi inspector upon arrival. Should any buyers choose to return a car, Beepi provides a 10-day money-back guarantee. In addition to this total refund, all cars are subject to a three-month, 3,000-mile warranty.

Beepi has already made significant strides in reshaping the antiquated process of buying and selling cars by offering direct sales to customers 100% online. The company is currently receiving 1,000 requests a week to sell the cars of residents in the San Francisco Bay Area alone.  This expansion comes hot on the heels of Beepi’s acceptance of bitcoin as a method of payment. Through Beepi’s partnership with BitPay, a buyer can now purchase a Beepi car using bitcoin while the seller still receives cash. The company also offers prospective buyers immediate pre-approval for loans at checkout. With these initiatives, buyers can pay for any car in the Beepi marketplace with a traditional car loan, a bank transfer, cashier’s check, up to six different credit cards at once or bitcoin.

For more information on cities participating in Beepi Prime, please go to www.beepi.com/beepiprime


Aug
7
14



The Next Evolution in Search

Today we are excited to announce our investment in Vurb.

Vurb’s enormous potential rests on a breakthrough technology that will make searching the Internet smarter, more consistent, and even seamless across desktop and mobile devices. Imagine being able to plan an evening out without having to jump in and out of apps or going back and forth to the search bar to make a restaurant reservation, find movie times, read reviews, and pick a place to meet for drinks afterward—all using the best of breed services or apps, but in one continuous search. You can even start your search on your desktop and finish it on your smartphone without losing anything.  After you’re done, you can share your collection with your friends or just save interesting places you found along the way for another time.

Vurb breaks down the independent search silos offered by today’s search engines. It knows where you have been, helps take you where you want to go, and integrates the services you want to see…complete with social interactions. It is a completely logical experience that matches how our brains work, not how the structure of browsers or apps work. No more typing a query into a blank search box, clicking on a result, and then going back and forth until an acceptable solution is located.

Surfing for information on smart phones is even worse.  Either you’re using a web browser to access many sites that are not optimized for mobile experiences or, more than likely, you’re using one of the popular single purpose apps downloaded on your phone.  Apps are great when you are trying to do a singular function for which the app was originally designed, but they are terrible at traversing functions and for wandering and discovering.  Surfing apps doesn’t work well at all today.

We believe that the transition from a desktop/laptop web world to a mobile/social world necessitates a different, better approach, particularly for core functions like search and navigation. Vurb, with its small, dedicated and talented team, offers that better approach.


Jul
14
14



The Power of Anonymity

All important social platforms start with a context that sets the stage for how people will express themselves and connect on those platforms. Facebook was private, tightly-connected relationships; Twitter was real-time, public discussion; Instagram was visual expression. This initial context is critical in defining the social interactions and reasons for engaging on a platform.

Secret, by orienting around anonymity, taps into raw and honest human emotion and allows people to communicate in ways they can’t on any other network. While I was at Twitter, I saw the incredible role pseudonymity and anonymity played in allowing people to broadcast and express themselves freely. From whistleblowers, to citizen journalists trying to get information out from under oppressive regimes, to the deeply personal, to the funniest parody accounts, anonymity allows expression that wouldn’t have otherwise happened.

But where Twitter is about putting a range of ideas out there for public consumption, Secret is much more about having an unfettered conversation with people closely connected to you, where individuals are free to express themselves without fear of embarrassment or judgment. We think it’s a fundamental and important part of social connectedness and we’re incredibly excited to back David Byttow, Chrys Bader, and the rest of the Secret team.

More importantly, at Redpoint we invest in great teams and we have been blown away by the Secret team’s ability to recruit, build and execute. They are one of the strongest teams we’ve seen and we think it gives them a huge competitive advantage to build and adapt a product to the emerging needs of their community. This is personally one of my first deals since I joined Redpoint and I’m really excited about working closely with the team on realizing the promise ahead of them. They understand and appreciate the power and responsibility that creating an anonymous network brings and we can’t wait to see what they build for their community.


Jul
8
14



Beepi starts Accepting BitCoin today!

 

Beepi has partnered with BitPay to insure buyers are provided with all the payment methods worthy of a 21st century marketplace.

Before Beepi, buying a high quality car involved a nasty trip to one or more car dealers.  Today people can buy a certified, pre-owned car, pay with BitCoin 100% online and have it delivered 48 hours later with a 10 day money back guarantee!

In addition to this news announced today, Beepi launches a site redesign that now features:

1- Redesigned listing page with advanced search, grid view and list view

2- Redesigned car page, with automatic zoom, pictures carrousel, safety ratings provided by the institute for highway safety, fuel economy provided by the EPA, standard and optional features provided by Edmunds

3- Redesigned Checkout with BitCoin integration, financing instant pre-approval connecting with Experian, and the Beepi Garage (which means you can now reserve a vehicle for 48 hours by paying a $300 deposit while organizing your finances)

Beepi continues to lead the way toward the next generation used car marketplace.