A VC in Vacationland

Seeking the next gen supply chain technology breakthroughs

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  • Managing Start-Ups: BeenVerified

    Image representing BeenVerified as depicted in...Image via CrunchBase

    Start-ups do not have a lot of time or money to make sure part time, full time or contract employees are, to be blunt, not crooks.  BeenVerified offers an inexpensive and  quick background check capability which can alert you that the person you are about to (or already have) hired is all that they say they are.

    To be clear, simple checks may not always identify (or may mis-identify) crooks in the workplace.  But they give you a place to start.  You may want to pay more for more exotic services.

    And you can use Dave's favorite question: "When I do a background check on you, I am not going to find anything questionable in your background, right?"  It's a legal question, by the way….

     

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  • Supply Chain Innovators: The Future of E-Commerce

    United States Postal ServiceImage via Wikipedia

    My thanks to the Stanford Global Supply Chain Management Forum (of which I am proud to be a co-founder)for the following insights. Note:  I hope the global Postal Services are nimble enough to be major players in these markets.

     

    In February the Stanford Global Supply Chain Management Forum and co-host International Post Corporation held a senior-level roundtable on Innovations in E-commerce. The one-day roundtable brought together leading online, offline and cross-channel retailers like eBay, Wal-Mart, Gap and Safeway, key  figures in the e-commerce value chain from the IT, logistics, and postal industries, as well as senior IPC executives and academics from the Stanford Global Supply Chain Management Forum.

     

    The main findings of the one-day roundtable were:

     

    •The future of e-commerce and the logistics to support it will drive ever-increasing convergence in technologies, and changing consumer demand. Greater convergence of brick-and-mortar and online/mobile is foreseen with the emergence of cross-channel retail experiences that seamlessly combine physical and virtual aspects of shopping.

     

    •Key trends are ‘social’ and ‘mobile’: global social media platforms like Facebook and Twitter will increasingly act as key drivers to e-commerce, and future growth will likely be predicated on the strong role of mobile technologies that integrate a range of existing and new features that will lead to the ubiquity of hyper-connected, always-on consumers.

     

    •The predicted explosion in e- and m-commerce will offer immense opportunities to postal operators – in cross-border e-commerce in particular. However friction points need to be resolved to realize the full potential of international e-commerce. Among these are landed costs and returns solutions. In order to become partners of choice for e-retailers, posts need to provide flexible, seamless solutions that offer greater cross-border visibility.,

     

    •Demand for free delivery is predicted to remain prevalent, posing challenges for e-retailers on how to address consumers’ perceptions of ‘free’ delivery while recouping the cost of shipping.

     

    •Meeting consumer demand for tracking solutions also implies costs. Consumers are likely to accept the lack of tracking services – and relatively slow delivery times – for low-value purchases (of less than say $10), whereas shopping cart purchase values of above this amount  trigger consumer demand for tracking services.

     

    •Winning consumer trust is critical and e-retailers need to be careful not to break the bond with consumers. A risk factor in this is the use of consumer details for promotional and marketing purposes. Consumer opt-outs are generally not made as easy as they could be, but this is not by consumers perceived to be a trust breaker. However any perceived misuse of personal data will likely result in consumers blacklisting the company, and to a receptive and wide audience thanks to social media.

     

    Speakers at the roundtable were: Mark Carges, Chief Technology Officer, eBay; Chris Curtin, Vice President Digital Strategy, Corporate Marketing, Hewlett-Packard; Jane Dyer, Director Markets and Communication, International Post Corporation; Hau L. Lee, Thoma Professor of Operations, Information and Technology, Stanford University; Paul Vogel, President & Chief Marketing/Sales Officer, United States Postal Service, and Jin Whang, Jagdeep and Roshni Singh Professor of Operations, Information & Technology, Stanford University.

     

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  • Supply Chain Innovators: Grubhub–Food Delivery Goes Big Time with a $20 Million Raise

    Image representing GrubHub as depicted in Crun...Image via CrunchBase


    According to Xconomy, Chicago-based startup GrubHub, a service that lets you order food for delivery or take out from local restaurants online or by mobile phone, has raised a whopping $20 million in Series D funding led by DAG Ventures with Benchmark Capital participating in the round. The startup recently raised $11 million in funding in November 2010, and has raised $34 million to date.

    GrubHub gives its users access to food delivery service from more than 13,000 restaurants in U.S. cities including: New York, Chicago, San Francisco, Oakland, Boston, Los Angeles, Washington DC, Philadelphia, San Diego, Seattle, Portland, Denver and Boulder. CEO and co-founder Matt Maloney says he expects to list 80,000 restaurants in the next three months and will be in over 26 cities by the end of this year.

    GrubHub is free for diners who order and pay for their meals with while restaurants pay
    commissions on each order processed. Restaurants that do not currently partner with GrubHub can still list their telephone numbers and menus for free. And of the 13,000 restaurant menus currently available on GrubHub, 5,000 establishments are paying GrubHub to manage and market a white-label online order and food delivery service.

    Mobile has also been a part of GrubHub’s expansion strategy, and the startup has launched iPhone and Android apps in the past year that allows users to find the restaurants that deliver near their current location. The apps feature the same functionality as the website, including the ability to view menus, comments, reviews and order, but adds GPS to the mix, making it easy for users to order food from the restaurants near their location.

    GrubHub has experienced a 300 percent increase in mobile food orders since last Fall. The company projects mobile orders to make up 20 percent of its total food sales by the end of 2011, which is compared to less than two percent in 2009 (mobile food orders accounted for 10 percent of total food sales in 2010).

    And if you take a look at the numbers (which GrubHub is more than willing to be reveal), the startup appears to be on a high-growth track. GrubHub sent $85 million in orders to restaurants in 2010 and is projected to send $200 million in orders by the end of this year. Last year, GrubHub pocketed $8.5 million in revenue (which is over 1000 percent growth from 2007′s revenue), and is on track to more than double revenue in 2011. And the company has only 100 employees.

    Maloney says he wasn’t planning to raise such a big round but after the recent $11 million Series C raise, he said he received emails and calls from over 30 top-tire VC firms looking to invest in the company. The new funding, says Maloney, will be used towards acquisitions and to boost GrubHub’s product development. For example, within the website and mobile apps GrubHub will be adding a “pick-up” option which will show users restaurants within a mile or so, that allows for pick-up orders.

    Bill Gurley, general partner of Benchmark Capital, said of the new round: “This additional funding will further support GrubHub’s momentum and enable it to follow in the footsteps of Benchmark’s other on-line portfolio companies such as OpenTable, Yelp and Zillow, which all share a template of local, social and mobile components.”

    Maloney feels that GrubHub can become the next OpenTable (which also had roots in Chicago), and that there is tremendous room for growth in the ector. He says that there are more than 300,000 delivery and takeout restaurants in the country and on average, GrubHub users order out more than 10 times a month. “Pickup and delivery are the fastest growing segments in restaurants and one of the largest sectors of the U.S. economy,” he explains.

    Another goal Maloney has is taking GrubHub public, also following in the footsteps of OpenTable, which filed for an IPO “Going public is a very realistic opprtunity for us wihtin the next two years,” says Maloney.

    Of course, for this to happen, GrubHub will have to increase revenues (OpenTable has close to $60 million yearly revenue when it went public), and prove to investors that its business is stable and growing in terms of both sales and users. Those are challenging and ambitious goals and certainly won’t be easy to achieve. But with savvy acquisitions, the right business model and a significant uptick in usage, GrubHub certainly shows potential to be a lasting presence in the online food services industry.

     

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  • The Second Coming of the Billion Prices Project

     

    The Billion Prices Project lives!  Here is the press release from last week:

    The BPP is proud to announce the launch of PriceStats, a start-up based in Cambridge MA with the mission of becoming a leading source of daily inflation statistics around the world.

    PriceStats will allow the BPP to focus on research and continue innovating in the field of real-time price statistics. Our research team will have access to a greater amount of data than ever before, which will be collected, processed, and shared by PriceStats for use in our research initiatives and experimental indices. In addition, this arrangement will allow the BPP to continue publishing the daily US inflation and World inflation indices on a monthly basis.

    PriceStats has partnered with State Street Global Markets to update daily inflation series in more than 40 countries through their client research portal, IR3. If you would like more information on how to access these series, please contact the PriceStats team at contact@pricestats.com.

    PriceStats is a young company and the team is growing fast. If you are interested in technology and economics, and would like to join the team, please email careers@pricestats.com

     

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  • How to Get Your Idea Funded

    Reid HoffmanImage by jdlasica via Flickr

    Any entrepreneur knows that it is a still a tough time for good ideas to get funded.  I have said often times in the past that I rarely see a bad idea, but often see a bad business model attached to a good idea.

    Reid Hoffman, serial entrepreneur- think Facebook and Zynga Gaming Network for starters- and a partner at Greylock Venture Partners has some interesting fund raising advise around winning business models for wanna be entrepreneurs. In a recent Wall Street Journal article (sorry, behind the paywall), Reid says that companies looking for venture funding should fit one of three profiles:

    1. A software platform that other small companies can build on, such as Facebook.
    2. An on-line marketplace that connects buyers and sellers in a new way, such as eBay.
    3. A network that links people and companies in more efficient way, such as LinkedIn. 

    Of course, having a technology in place that works and scales, more than 50,000 customers and a large potential market that is easy to sell in an inexpensive way will not hurt your chances. But the underlying profile should focus on one of the three business models to get any traction in the funding community.

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  • Highways that generate electricity from the sun? Out of the box thinking that could lead to safer roads and cheap power. Check out the short video… http://www.wimp.com/solarhighways/

  • Trademark Database Trademarkia Debuts Automatic Activity Notifications

    United States Patent and Trademark Office sealImage via Wikipedia

     


    According to TechCrunch, search engine Trademarkia, which launched at TechCrunch50 in 2009, is an comprehensive database of over 6.5 million U.S. trademarks filed since 1870, including dead marks. Today, the database is launching a new feature that’s sure to be useful for both startups and large companies—automatic trademark activity notifications.

    Trademarkia scans of all the marks and returns results in a visual grid that’s a lot easier to make sense of than the USPTO’s trademark database. You can search by company, theme, product category, or even filing attorney. Companies can also file a trademark with the U.S. Patent and Trademark Office through the site. And Trademarkia.com offers trademarked logo search that allows users to search inside millions logos for specific features or design elements.

    With the new feature, the search engine will deliver instant notifications about new trademark filings and other activities by email. Anytime activity takes place, such as a new filing, approval or “office action,” Trademarkia will deliver you an email alert for the companies, brands or filings you choose. And the service is free.

     

       

     

     

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  • MIT shuts down the Billion Price Project? A big loss if so. All the reasoning is still unclear, but here is one view http://www.zerohedge.com/article/why-mit-not-willing-unleash-real-time-dynamic-purchasing-inventory-control-systems-or-true-r

  • Do You Need to Be a Pr*** to Be a Successful Investor??

    Sepia photograph of the "Atlas" stat...Image via Wikipedia

    One promise I made to myself when I became a venture investor was never to become a pr*** like a lot of guys in the VC world.  I have had to live with my share of tough investing partners in this business.  Often, they were right about how deals should go down, how to relentlessly drive the CEO for more growth, how to minimize employee ownership shares to maximize their returns, etc.etc. But do you need to be a pr*** to be create successful businesses? I don't think so…

    You clearly have to have tough skin to survive in an early stage investing world that competes for a small number(less than 5% of start-ups are big winners) of worthwhile investments.  Meanwhile, you have to listen to a whole bunch of pitches and perhaps even work with an entrepreneur for a number of months before you know if the idea is feasible.  And even then, the odds of failing are high. As I have said many times before in this Blog, I rarely see a bad idea, but I often see bad business models and poor execution.

    But if the team is executing well, meeting plan and creating value, does it make sense to chastise them at the Board and other meetings in an effort to get even more performance out of the team? Some guys seem to think that yelling and screaming is the best way to manage start ups. To me, it makes very little sense, since the team is already working 80 hours a week to make the new enterprise successful.

    Wealth can bring out the worst in some people.  Even thought they are very smart, sold their startup for millions (or more) and could pass on their knowledge without being a pr***, they seem to think that it is the only way to get their points across.  I pity the entrepreneurs that have to work in such environments.

    I have seen companies where such behavior was rampant and the companies were successful.  But the pr*** behavior did not create any extra value for the team or investors compared to having a supportive group of investors.

    The lesson?  Choose your investors carefully.  It may not be worth taking the pr***'s money if you have to put up with bad behavior for years. Remember that, like Atlas above, you have the careers and lives of all your employees on your shoulders. Do not put extra strain on you or them.  It is tough enough getting to be one of the 5% without extra investor baggage.

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  • The Sunday NY Times had an interesting article on Distilling the Wisdom of CEO's, based on the book The Corner Office by Adam Bryant. Worth a read. http://www.nytimes.com/2011/04/17/business/17excerpt.html?scp=1&sq=wisdom%20of%20CEO's&st=cse