Frederick Cook's posterous http://frederickcook.com Most recent posts at Frederick Cook's posterous posterous.com Tue, 27 Dec 2011 09:11:00 -0800 Closing one chapter, Opening the next http://frederickcook.com/closing-one-chapter-opening-the-next http://frederickcook.com/closing-one-chapter-opening-the-next

As those of you who have been closely watching Heyo have probably guessed, it is not, in fact, coming soon.

Since founding Heyo in May of 2010, I worked on several exciting businesses with several extremely talented people. That journey, however, has come to an end.

In November, I, and the Heyo Board, decided to put together a plan to return the cash and assets of the business to the investors. I plan to at some point write a much longer post to explain the set of circumstances that led to this decision, but this is not that post. (If you ask me in person, I'm happy to share. It's just a little too soon to do so in front of the entire internet.)

Since we started putting together the shut-down plan in November, I have been evaluating a number of opportunities to start other startups, or join existing ones.

Around that time, I was asked to take a look at a project called Moveline, which has big ambitions in the household goods moving industry. The result is, after several weeks of working with the team, I'm extremely excited to be joining Kelly Eidson in taking the Moveline project and introducing it as a new startup. There will be much more to come about Moveline in 2012, and we're both extremely excited about it.

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Wed, 12 Oct 2011 06:30:00 -0700 The Anxiety of Distraction is as Distracting as Distraction http://frederickcook.com/the-anxiety-of-distraction-is-as-distracting http://frederickcook.com/the-anxiety-of-distraction-is-as-distracting

Work
When I design a software system, I'll typically design the system in my mind first, then map it into code. Depending on the complexity of the system, there is a ton to keep track of, and as the system is coded, new issues are identified and the design is modified.

When I become distracted, it takes a really long time to get back up to speed. If I lose the mental model of the system I'm building, I need to regenerate the model before I can continue to build. This is why long stints of uninterrupted time are most productive for a software developer: A very complex system can be designed and mapped to code. Interruptions to this process add significant overhead, and can easily double or triple development time.

Over the last few months though, I've noticed in myself another distraction that is more costly than interruption. If I am in a situation where I know it is possible that I will be interrupted, I'm limited in how much concentration I can bring to a task. This anxiety comes in many forms, but is almost always external. It can be as simple as sitting next to a friend or co-worker who you think might say something to you. It can also be something like knowing that you have an appointment coming up within the hour, and that you won't be able to get very far with your task before having to abandon the mental model and focus on something else. 

When building a software system, the effect is that I cannot get very deep into the mental model, which limits the scope, complexity, and quality of the system I am working on.

There are many ways to deal with this anxiety. In a work environment, the best is probably the headphone rule: If someone is wearing headphones, you don't bother them, unless something is really important. We're talking imminent physical danger important, like a fire (or worse, if the website goes down). To be effective, this shouldn't be implied, it should be explicit. In order for me to really concentrate, I have to know that people around me aren't simply deterred because of the headphones: they should know that this is a concrete rule.

In startups, for people who do both business and technical activities, try Paul Graham's maker time vs. manager time. Picking a time when you know it is unlikely you'll get a phone call or visit, and can devote yourself completely to some productive task, leaves you free from the anxiety of distraction.

I think this is also a great argument for having co-founders who are specialized, and another argument against being a single founder. Having one person be a full-time developer, and trusting another co-founder to take care of every other task, can be an incredibly powerful combination.

In corporations, if your developers are on a four-hour work, lunch break, four-hour work schedule, make sure those four-hour blocks are uninterrupted. If I come in to the office at 9am, and have a 10:30 meeting scheduled, and then lunch is typically around noon, it will be 1pm before I actually can confidently dive into a complex project. If the decision is made to leave sacred certain times for developers, make that decision a policy that everyone knows, and encourage developers to fight back if someone encroaches on that time. 

The ability to quickly design and code very complex systems with a high degree of quality is why really good developers are worth 50x or 100x as much as average developers, and the biggest software companies have budgets in the hundreds of thousands of dollars range to recruit them. Don't let the threat of someone tapping your developer on the shoulder cripple them.

 

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Thu, 16 Jun 2011 13:03:00 -0700 TechStars Wildcard NYC http://frederickcook.com/techstars-wildcard-nyc http://frederickcook.com/techstars-wildcard-nyc

Last week, TechStars invited ten companies to come to New York for a new program called TechStars Wildcard. The feedback for these ten companies was that the selection team really liked the founders, but didn't like the idea they were working on. The program was very informal: a meeting at the TechStars NYC office for all the founders to meet each other, then a week to re-apply. The expectation was that ideas would change, and new teams would possibly form. (For some numbers, we were told over 1000 companies applied, about 25 were selected as finalists, and the ten of us were selected as Wildcards.)

Heyo was one of the companies invited. The decision to even attend was tough. I've been working on Heyo from San Francisco for the last few weeks, and it would cost a significant amount to fly to NY for a week last-minute. I considered it for a couple days and talked with a couple of my mentors and our current investors. It was a big risk: in addition to the cost, it would be a huge distraction, and by definition, accepting it meant we would be willing to start fresh with a new idea. It also sounded really exciting, and was unprecedented as far as I know of in the seed-stage incubator world. I bought a one-way SF-NY redeye the night before (I wasn't sure how long I'd be there), packed my suitcase, and flew to New York.

We met at the TS office a block off Union Square in Manhattan. About 30 of us founders sat in a circle, and were joined by a handful of mentors from the TechStars team. After a brief explanation from David Tisch of how the Wildcard program would work, we went around the circle and introduced ourselves. 

It was an amazingly talented group of people. Having founded Heyo straight out of college, I felt I was definitely one of the less impressive people there based on professional accolades. There were folks with backgrounds in private equity, VC, real estate, politics, hedge funds, high-frequency trading and obviously technology. Importantly, and to TechStars credit, pretty much everyone was also either a designer or a developer.

After going around the circle, the structured part of the Wildcard program was over, and we all mingled at the TechStars office for a few hours getting to know each other and talking about new ideas. Interestingly, it seemed that probably more than half of the companies there were building something similar to Heyo: a consumer product that required massive adoption to be successful, but was still in development or didn't have significant traction yet. (A sophisticated tech investor will tell you that companies like this are hard to fund, because there are thousands of companies trying to build the next consumer mobile/web tool to get mass adoption, and if you're only picking one, it's unlikely that you'll be able to pick the right one.)

After a couple hours, they kicked us out of TechStars, and a group of us went out to dinner. The discussions that night, and over the next couple of days were incredible. Imagine this: a dozen people sitting around a table. Nobody has a full-time job: everyone has either founded a company, or is living off savings while working on one. The stakes are incredibly high: a successful applicant gets investment from TechStars, and access to some of the best-known mentors and investors in the tech world. And everybody is willing to take a huge risk on a huge new idea.

Over those couple of days, we talked about a huge number of new ideas, from new approaches to health care and education, to multi-use retail space, to hover-boards. We even discussed the prospect of starting a new company with a dozen founders. The common thread of the conversation was, "What would this industry look like if we built it from the ground up? Would it look significantly different than it does today?"

After a couple of days of meeting with everyone, we started splitting into smaller groups, and working on more specific ideas. I won't go into details on what I worked on just yet, but I ended up teaming up with a couple other guys and spending the next couple of days working on a new idea in real estate. We ran around New York for a few days meeting with everyone who we could get time with, spent a couple days cold-calling potential customers, and by the weekend, had significantly fleshed out what this new company could look like. We re-applied a few minutes before the deadline, then headed out of the city.

The last few days, we've been building a simple minimum viable product to put in front of potential customers. We received word last night that we would not be accepted to the TechStars program. Despite that, we are continuing to work on this concept and may be forming a new company soon.

Thank you to Dave Tisch, Adam Rothenberg, and the other mentors at TechStars for inviting us and advising us over those few days. Thanks also to Jesse and WeWork for letting us work out of your sweet office for a few days. Thanks to Judd, Benjie, Dave, David, Roger, David, Sam, Matt, Nicolas, and Will for making the week awesome.

If you have experience working, building things, or investing in companies in the real estate rental market, please email me, fred at heyo dot com. Also, we're still looking for another technical co-founder, so if you're interested in getting in on the ground floor of something awesome, please get in touch. We think we might be starting in Chicago.

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Mon, 30 May 2011 10:52:00 -0700 A One-Way Ticket to SFO http://frederickcook.com/a-one-way-ticket-to-sfo http://frederickcook.com/a-one-way-ticket-to-sfo

Yesterday, I flew to SF on a one-way ticket. I’m sleeping on a friend’s couch right now (plug: check out HeardAbout!).

At Heyo, we have been evaluating for some time the possibility of moving out of Blacksburg, VA, to a place that is more of a startup hub. In the last few months, we’ve spent time in New York, Austin, and the San Francisco Bay Area. We have decided on California, and a couple days ago, the time and ticket fare were right ($120, non-stop IAD to SFO, thanks HipMunk), so I bought a ticket and flew out. I packed a carry-on with clothes and coffee supplies, and my backpack with my laptop and business stuff.

There are many reasons we decided to move, both personal and professional. Here they are:

Professional

Blacksburg does not have a lack of talent. Hundreds of very talented computer science and computer engineering students graduate from Virginia Tech each year, and there is a solid base of technical professionals there. The handful of major tech companies in Blacksburg that have made recruitment a priority have been quite successful in keeping students and other professionals in the area. However, there are a lack of talented engineers who are familiar with and subscribe to the startup culture. That is, they are generally not interested in (let alone possess the requisite passion for) forgoing a career to live cheap, work hard, and start a company.

The same thing that draws me to the SF Bay Area draws many others like me. We are searching for others like us, with the aptitude and ambition to build awesome companies. Over the last several decades, this has created an eco-system of innovation, investment, and mentorship unmatched in any other geographic area in the world. I understand that there is a massive talent war in the valley right now, and I don’t expect it will be easy to recruit others to join us. However, I know from experience that other developers respond very well to our company and our culture. We solve a very real problem, our market is huge, and we are building a culture that places developers at the center of our business (because, well, we’re developers). I hope this will enable us to find awesome people.

We will also begin seeking investment in the next few months. Our criteria for investors is that they have done what we want to do, which is build an awesome web business. In Blacksburg there are a handful of these people, and many of them are our investors already. Out here there are thousands(?), many who have done it many times over. I want those people invested in our business, mentoring us, and thinking about our product.

Personal

I lived in King George County, VA (pop. 25,000) for 18 years, and Blacksburg (pop. 60,000, half students) for almost 8. When I was looking for what to do after my undergraduate degree, I found excellent faculty members in Blacksburg to work with for a masters degree. When I finished my masters degree and went looking for co-founders and investors to start a company, I again found them in Blacksburg. While I have travelled extensively in the U.S., I have never lived in large city. I’m young, single, and have no financial or social obligation to be anywhere. It’s time for me to leave Blacksburg.

None of this is a knock on Blacksburg, which in the last year has seen the formation of a startup incubator, angel group, two co-working spaces for tech companies, and Virginia Tech E-Club being ranked a top entrepreneur club in the country. I’ll be back often, and a part of me will always be there.

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Mon, 25 Apr 2011 11:52:21 -0700 Continuous Deployment in Startup Mode (via Heyo) http://frederickcook.com/continuous-deployment-in-startup-mode-via-hey http://frederickcook.com/continuous-deployment-in-startup-mode-via-hey We put a new post up on the Heyo blog today about the continuous deployment strategy we use.

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Thu, 24 Mar 2011 13:21:09 -0700 Are we in a bubble? http://frederickcook.com/are-we-in-a-bubble http://frederickcook.com/are-we-in-a-bubble Best summary of bubble/non-bubble debate I've read yet:

[Are we in a bubble?]

“Maybe,” says Naval, “Certainly valuations are creepy up quickly in all stages of deals. On the other hand, 10 years ago when we all felt like this last time the total market size for any company was at maximum 100 million potential users. Now we’re in the billions of users. Facebook connections alone bring 500 million, Twitter 200 million. 10 years ago we only connected for brief periods of time when we were at our PCs. Now we’re connected to apps all the time, everywhere we go. So maybe there’s a bubble. It’s hard to say. But we’re also looking at unprecedented opportunity.”

http://www.bothsidesofthetable.com/2011/03/22/the-magic-midnight-mind-meld/

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Tue, 18 Jan 2011 08:20:00 -0800 Silicon Valley in 72 Hours http://frederickcook.com/silicon-valley-in-72-hours http://frederickcook.com/silicon-valley-in-72-hours
I'd never been to the Valley before. The startup I co-founded, Heyo, is currently based in Blacksburg, VA, but is planning to move out there in May. The goal of this trip was to get to know the area a bit and try to meet some folks. Armed with Paul Graham's Where to See Silicon Valley and Garry Tan's guide to where to startup your startup, I meticulously planned my 3-day west coast trip while sitting on the tarmac, waiting for the plane to de-ice in Roanoke. Here are some notable people, places, and events that made the trip awesome.

Stayed with an airbnb Co-founder
The random airbnb place in Palo Alto I got Tuesday night was the apartment of one of the 3 founders of airbnb and his wife. I won't mention his name or the place (because they don't mention it in the listing), but he and his wife were wonderful, and we talked Stanford and startups over dinner before he gave me a ride to an event that I didn't really have a plan on how to get to. Incredible first experience in the Valley.

Deepak Kamra, Christine Herron, Rudy Garza, Mark Suster, Joel Yarmon
This was Larry Chiang's Reverse VC Panel. There were probably only 25 total attendees, and the topic was "How to get a VC to mentor you". Anthony Ha and Amy Saper did a great job of keeping it moving. A couple points that stuck with me here:
- Christine Herron noted how tough it is for women to find mentors, because of how inappropriate it would have been for her to regularly spend time with an older male mentor.
- They also noted a distinct difference between being contacted by a student for help/advice vs. someone out of school. Take note here, students: when you contact powerful people, they feel good helping you out while you still have a clean slate. Once you define yourself, either with a job or a startup, you're in a different world. Take advantage (see notes on Cory Levy below).
- There seems to be an incredible contradiction about a profession where to be successful you have to meet with as many smart people, working on world-changing things, as possible, but the whole time you're looking for a reason to tell them "no".

Peter Theil (at NextGen Conference)
Peter is a very smart dude. A few notes I made from his talk include:
- He likes to invest in companies with a complex technology and complex sales process. He specifically mentioned SpaceX, and how building rockets and selling them to the federal government is pretty much as complex as it gets.
- Starting a big company is no less risky than starting a small company, so take big investment and shoot for the moon. He said they like to invest in companies that will never exit otherwise.
- He also talked about how silly it is to try to start a company in consumer internet or mobile right now, because it's incredibly crowded. Oops.

Mark Suster (again)
Mark's talk was on mistakes he made and what can be learned from them. I follow Mark's blog and he reiterated a lot of points he discusses there, so I didn't have a ton of take-aways here. I definitely love hearing a 15-minute recap of the life of an entire company, especially from the times of the dot-com bust. Tons to learn about the mentality of the industry there. Mark's subtle humor and self-deprecation also make him a pretty likable guy.

Keith Rabios
Keith has the intelligent, confident, but casual demeanor of a tech executive. I can see what makes people want to follow him. The thing that impressed me about Keith is that he is still in an operational role at a startup after all his success. That's passion.

Cory Levy
Cory is notable because he is a freshman in college in Texas and put together the NextGen Conference where the previous three speakers spoke. Awesome conference, Cory. You're money.

Founder's Den
At NextGen and for the rest of the trip, I was joined by an investor/advisor of ours at Heyo, Bill Boebel, who built a company and sold it to Rackspace a few years ago. Bill and I headed up to the city (apparently even people who live in San Jose are referring to San Francisco when they say "the city") after NextGen for a meeting with Jason Johnson and Jonathan Abrams at the new Founders Den. I doubt this post will hit their Google Alert because they just opened a few days ago and had Forbes (among other publications) in there interviewing them the same day we were there. Their idea is to fill their space with about half experienced (2nd-time +) entrepreneurs, and half first-timers, about 10 companies total. It was definitely an incredibly experienced group that they have put together there, and a beautiful space.

Twitter HQ
A couple blocks up from Founders Den is Twitter's HQ. A friend of Bill’s from Rackspace who recently left for Twitter to work on Cassandra big-data applications, was still at work and brought us up to the Twitter offices to take a look around. It doesn't seem that long ago that nobody outside of the Valley took Twitter seriously. Being in this awesome office with hundreds of engineers was very cool - some kind of odd proof for me that going for a big world-changing idea that people will mock as a real business really can "work out". It was 7pm on a Thursday and there was still a lot of activity at Twitter... their legal team was even having a mini happy hour.

Awesome View of the City
On the way to dinner, Bill accidentally put us on the Bay Bridge. (We turned around on Treasure Island.) On the way back we had the most incredible view of San Francisco I'd ever seen, with the Golden Gate Bridge as a backdrop to the newly lit city in the early evening. If you've never been to SF, I recommend accidentally taking the Bay Bridge.

Peruvian, Margharitas, Racer 5, and Bikers
Wednesday night we went out in San Francisco with some friends. It was a damn fun night, with one of the highlights being randomly running into Alex Polvi and a friend at Zeitgeist at 12:30am having grilled cheese sandwiches. Alex's company, Cloudkick, was recently acquired by Rackspace, and interestingly Alex knew all about me and Heyo, having reviewed our YC application in the Fall (we weren't accepted). That makes him one of probably five people in California who knew what Heyo was back in early November before we released our initial apps.

Citizen Space
Thursday morning, after a slow start and driving around the city a bit in the morning (including the squiggly road), I checked out a few coworking spaces around the city while Bill was in meetings all day. First was Citizen Space, which has a great location on 2nd street. Apparently this was the first space of its kind in the city when it got started (2006?). I like that it's not expensive and not-for-profit, and the folks I talked to there were very down-to-Earth. Very quiet and casual.

Pier 38
Everyone we spoke to about coworking spaces in the city mentioned Pier 38 as an awesome place to work. Part of the space is Polaris Ventures/Dogpatch Labs, and the rest is managed separately. I hadn't had any luck with getting in touch with a Dogpatch person, and couldn't find any other contact info regarding the space, so I just dropped in. After getting a bit of work done in the cafe area, I got to chat with Ken Thom, the manager of the space. Ken is the nicest guy I've ever met, and the space is amazing. Beautifully furnished, awesome location, awesome views, and startups we read about everyday housed there.

SOMAcentral
SOMAcentral had been recommended to me, but I couldn't find anything about it online. Ken manages this space as well though, and it worked out that he was able to show me around this space too (it is a few blocks away from Pier 38). This space was much more officey and less open than Pier 38, but had some amazing companies and some offices with excellent views of the city. Thanks, Ken!

pariSoma
If Pier 38 and SOMAcentral had a classy, professional-but-still-startup feel, pariSoma felt much younger and scrappier. It's a few blocks away in a different part of town than the others I went to (North part of The Mission), and definitely felt a bit more indie. I think the major difference is that Pier 38 and SOMAcentral had mostly angel- and venture-funded startups, while pariSoma probably had mostly seed-funded and bootstrapped startups. They're moving into a much larger new space in a few weeks (right around the corner from the current space) as well.

Facebook House/HQ
Thursday afternoon we headed back down towards Palo Alto, this time taking I-280 instead of the 101. Good call, Paul. We took the Sand Hill Road exit, and Bill pointed out all the big VC firms, though the buildings are all incredibly nondescript. Bill had found the address to the original Facebook house somewhere online, and as we weaved through some neighborhoods to avoid traffic, we kind of stumbled upon Facebook Headquarters, which seems to be in a very residential part of Palo Alto. When we finally came across the Facebook House, it was predictably unremarkable, though I will say I was disappointed that I couldn't even find it as a location on Facebook Places. (Sorry to whoever actually lives there, it probably gets old having cars creep slowly by while trying to perform a check-in.)

500 Startups
Thursday evening was the 500 Startups/Startup2Startup holiday party at the new 500 Startups incubator space off Castro Street (in Mountain View). Bill is a mentor and LP in the fund, and this was the grand opening of the new space (guessing that's why it was a holiday party in January). So, Dave McClure knows how to throw a party, or at least how to budget for one. Amazing food, top shelf open bar, a pirate doing magic tricks, and a photo booth with pirate paraphernalia were the highlights. It also seemed like every venture fund sent somebody along (met Bill’s friend Yujin at Andreessen Horowitz), as well as all the major tech blogs (even Scoble). It was my first SV party, so I have no idea if that is the norm or exception for seed-stage incubator parties, but it was quite the experience.

Breakfast at Joanie's off California Av.
I wouldn't necessarily mention this as noteworthy (though the breakfast crepe with smoked apple sausage at Joanie's was phenomenal), but after seeing so many "celebrities" of the valley in the previous couple of days, I'd be remiss to not mention this experience: After a delightful breakfast with a friend who is a hardware engineer at Apple, I found myself face-to-face with Paul Graham while walking out of the restaurant. I stammered the wittiest thing I could conjure ("Hey, Paul Graham!"), which I think made us both instantly uncomfortable, and I slinked away. Sorry, pg.

Plug and Play Labs
After a few minutes of downtime in a coffee shop on University Avenue, we had a late-morning appointment at Plug and Play down in Sunnyvale. I was supposed to give a two-minute pitch to a group of "Executives in Residence", though didn't realize I needed an accompanying slide deck (for a two-minute presentation) until we arrived and everyone else had one. I had no idea how many slides to make (for a two-minute presentation), so I took my normal deck and trimmed it to… two: product and team. It turned out everyone else was pitching enterprise hardware/software, and ran way over. I'm not sure to be proud of the fact that I stuck to the constraint, or silly for not doing my full pitch, but we inferred some good feedback from the questions asked after, so I'm happy with the outcome. For Plug and Play itself, it was the opposite of the coworking spaces in the city: all cubicles, and more corporate feeling, though I definitely got the impression that everyone was there to just get work done, (plus it was the middle of the day, so there weren't any events going on, which they apparently do a lot of.) It kind of follows the general trend we saw from different areas on the trip: if you want to just get work done (hammer out an MVP), down in the valley is great. If culture and lifestyle are also important to you, the city is the place to be.

Google
After Plug and Play, Bill had a meeting on Sand Hill Road, so after dropping him off, I only had about an hour, so I drove back down to Mountain View to check out the Google campus. Even though it was basically an office park, it definitely had the feel of a university campus. There were rec fields adjacent to it, lots of green space in general, and those funny colorful bicycles. Everyone riding those colorful bicycles seemed so care-free, which was probably because of how goofy people look on a bike that is a little too small for them.

Majesty
After picking up Bill and dropping him off at SFO, I had a few more hours until my redeye, so I went back up to the city to have dinner with a couple more friends. I had some down-time before they got off work, and stumbled across Fort Mason, where I walked around for about an hour or so and took some touristy photos. The highlight here was watching the fog roll in to the bay. Every few minutes, it would creep a bit farther around the mountains on the south side and claim more of the Golden Gate. It's been a long time since I've seen something I'd describe as majestic. The fog was.

Thanks for reading!

 

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Sat, 11 Dec 2010 10:20:00 -0800 Infrastructure Costs http://frederickcook.com/infrastructure-costs http://frederickcook.com/infrastructure-costs

I've explained to many, many people why now is an excellent time to start an internet business, but the anecdote from Mark Suster below about the drop in cost is an awesome articulation of the point. Costs fell by an order of magnitude from 1999 to 2005. They have fallen by AT LEAST another order of magnitude from 2005 to today. From Mark:

When I started my first company in 1999 we spent more than $2 million on technology infrastructure including Sun servers & Solaris operating system, Oracle databases, EMC storage, load balancers, app servers, back-up devices, disk mirrors and on and on.  That is excluding a single line of code or paying any salaries.  No wonder people had to raise $5 million just to get started back then.  We raised $16.5 million in our A round.  Hardware ate just over 10% of the round.

We put all of this infrastructure in an Exodus web hosting facility and had to pay for rack space, bandwidth and some management services if a disk failed, for example.

When I started my second company in 2005 we decided to do everything differently.  By then the open-source movement had really developed.  We were able to use an open source database (Postgres), open source search (Lucene) and a host of other free components including Apache Tomcat, JBoss.  We still bought our own physical infrastructure: horizontally scalable application servers, load balancers, etc.  So I still had to outlay $50-80k for hardware costs.  So we only had to raise $500,000 to get going and again hardware ate just over 10% of the round.

And further down:

Imagine that you can develop software on your local computer but the entire service is delivered virtually through a partner in the same way people consumer energy with all of the scale benefits that go with that.  They deal with energy management, security, physical device failures, etc.

This has allowed people to get started for $50,000 and spend just $5,000 on hardware – again around 10%.

Full: http://www.bothsidesofthetable.com/2010/12/09/data-is-the-next-major-layer-of-the-cloud-a-major-victory-for-startups/

 

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Sun, 14 Nov 2010 10:17:00 -0800 There Is No Bubble http://frederickcook.com/there-is-no-bubble http://frederickcook.com/there-is-no-bubble
A lot of smart people have recently been hinting that the current climate in the startup world (systematic increase in valuations, “hot deals” with very high valuations, increasing cost of talent, and a sharp uptick in number of startups receiving seed funding) is not rational or sustainable. People are tip-toeing around using the word bubble, but it’s insinuated that some sort of crash, or at least a decline is impending. I respectfully disagree.
 
The same technology and market forces that are encouraging a rise in seed incubators and seed-stage investments are driving up the valuations of the companies coming out of these programs. The fact that it is cheaper than it has ever been to start a company also means it is cheaper than it has ever been to grow a company.
 
In Econ 101, we learned that the cost of a barrel of oil has nothing to do with the actual cost of drilling the oil, and everything to do with what people are willing to pay for it. This is how gas can be $4.40 per gallon and Exxon makes record profits: the market price is completely de-coupled from the actual cost of production.

The same thing is happening in startups today. The valuation of a startup has nothing to do with the actual cost of running the startup: the number of employees, how many years (or months) they have been in business, are irrelevant to the assigned price tag. It has everything to do with what an investor is willing to pay to be a part of the financing round. In a rational market, what an investor will pay is based on the potential size the startup could someday be, offset by the risk that the company will never achieve that size.

Today, a startup can get much farther than it could just a few years ago on much, much less. A couple of talented developers can spend a quarter of a year patching together existing technologies and external APIs, put a beautiful, simple interface on it, and have a company with the same potential as one that just a few years ago it would take a dozen engineers a year to build. Social media and inbound marketing can drive significant traffic without spending a dime on direct advertising.

Hence, a company coming out of an incubator program such as YCombinator with only two-three employees is getting the same valuation as one that not too long ago was several times that size and years older. Because of that, many more investors are willing to take the risk on a couple of developers, hence the spike in seed investment. (For this same reason, the labor cost of a very talented developer at a large company is also increasing.)

So, there is no bubble. All that has happened is that the valuations of companies are finally starting to reflect the new norm, which is that a company can build something significant much faster, and with fewer people than has ever been possible.

 

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Sun, 31 Oct 2010 11:03:00 -0700 Life, and how to survive it http://frederickcook.com/life-and-how-to-survive-it http://frederickcook.com/life-and-how-to-survive-it

"So what should you do? You will find your own niche. I don’t imagine you will need to look very hard. By this time in your life, you will have a very good idea of what you will want to do. In fact, I’ll go further and say the ideal situation would be that you will not be able to stop yourself pursuing your passions"

"Find that pursuit that will energise you, consume you, become an obsession. Each day, you must rise with a restless enthusiasm. If you don’t, you are working."

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Mon, 25 Oct 2010 10:02:00 -0700 How will you find your truest, most productive niche? http://frederickcook.com/how-will-you-find-your-truest-most-productive http://frederickcook.com/how-will-you-find-your-truest-most-productive

I read this post by Garry Tan this morning about Edward Witten, and how it took him many years to find his passion: http://garrysub.posterous.com/how-will-you-find-your-truest-most-productive. It's short and worth reading.

It reminds me of myself (except for the genius physicist part) and how I've found my passion:

In high school and during my undergraduate studies in engineering, there were some classes I tried really hard in, and others in which I did barely enough to get by. It depended on how much I liked the teacher and how interesting the material was. It wasn't that I couldn't have done much better, it was just that I didn't care all that much. I chose Engineering Mechanics because it was the hardest (and broadest) major I could find, and I put in just enough effort to graduate with an above-average GPA.

Because of a couple of great professors (and the accompanying promise of flexibility) I stayed for graduate school in Engineering Mechanics, even though I knew research wasn't what I wanted to do long-term. During this time, I got to know other graduate students who would work 12-14 hours a day, 6-7 days a week on their research. For me, if it was a sunny day out, I'd skip the lab and go for a long bike ride, and I never considered coming in on weekends. I simply didn't understand how someone could work that hard on something.

I do now. Since starting Heyo, I've consistently put in at least that many hours, and I would put in more if I could. I absolutely love working on this startup, and I know that this company, and likely many other companies after this, will be my life's work. Regardless of how good of a research engineer (or anything else) I could have been, the world of startups is my truest, most productive niche.

 

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Sat, 16 Oct 2010 09:22:00 -0700 VA to NYC for Ask YC Anything http://frederickcook.com/va-to-nyc-for-ask-yc-anything http://frederickcook.com/va-to-nyc-for-ask-yc-anything

Imag0016

Last Wednesday morning, my co-founder, and I left Virginia and drove to NYC for the Ask YC Anything event at Hunch. We parked in NJ, and took the PATH over, went to the Hunch offices early (thanks for hosting us, guys), stayed through the event, then took the train back to the car and drove back to Virginia, arriving home early Thursday morning. According to our parking garage ticket[1], we were there for 8 hours 10 min. Here're our take-aways:

Living in Blacksburg, we're seriously starved for startup culture. Though our investors, DayOne, are trying to change this, there are still something like four actual startups here. It's very hard to go get a beer with someone and talk startups. This trip was the first time we'd been to anything out of the area since we started the company back in June, and it was a rush. Meeting Harj and Alexis, being at Hunch, and speaking to Chris Dixon[2] is probably what it's like for a teenage girl to read gossip magazines for years, then go to a celebrity party in LA. We were giddy. We also met several YC alum from the companies Octopart, WattVision, and Olark. Awesome guys, and friends we wish we had locally.

We didn't get the impression we were at any less of an information advantage than anyone in that room. Whether from NY, SF, or Blacksburg, we all read the same stuff which shapes our view of the startup world. I always had this impression that because I don't regularly talk to many other startup founders, I'm missing out on big things in the community, but I think that fear has been somewhat allayed. (On the other hand, it's likely that we still have no idea what we're missing.)

I think we also learned that we're just as good. We gave our product demo (Heyo, first release for iPhone and Android in the next few days) to many people, and got some really positive feedback. My co-founder and I both studied engineering at Virginia Tech, a public university not known for churning out startups. Before this trip, we both knew that together we can build literally anything that we can imagine on the internet. We still believe that, and now I think we believe we can do it as well as any other startup out there.

Overall, the trip was a huge confidence booster for us. Lots of folks told us that we have a sweet product, and that marketing it would be the hardest part. We know, and understand how enormous this task is. We're very excited about it.

[1] Total cost: we brought food and didn't stay the night, so $38 in tolls + $26 parking + $8 train + $50 gas = $122. I think it was quite a bargain for those insights.

[2] Probably about 80-100 people attended the event, and before it started, Chris Dixon was sitting in the back of the room doing something on his phone, waiting with the rest of us for this thing to kick off. I couldn't believe it: I was in the same room as Chris Dixon with dozens of other people, and nobody seemed to even notice him there. It was like a horse in the Apple Store moment. So obviously, my co-founder and I went back and talked to him for 10 min or so before it started, gave him a demo, got some feedback on our product, and some advice on how to deal with an issue I was working on with one of our investors. Thanks, Chris!


 

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Sun, 05 Sep 2010 12:23:00 -0700 Startup Shape http://frederickcook.com/startup-shape http://frederickcook.com/startup-shape

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In 2009, I did 2 Ironman triathlons, a marathon, and a half-dozen other races. I worked out 6-12 times a week. In May of 2010, I started working full-time on a startup. Currently, I exercise 1-2 times per week, and work the rest of the time. I haven't gained any weight, and generally feel very healthy. Here's why this works:

I never stopped working out for an extended period. If I go 3-4 days without doing anything athletic, I start to get irritable and generally don't feel good about myself. A 30 minute run is usually enough to make me feel normal again. We have a shower at our office, so it's easy to go out for a run, and be back at my desk within a few minutes of getting back. The other workout I do is yoga, which is an great full-body workout. Doing a couple of workouts a week, consistently, has helped me keep my metabolism from falling way off.

I usually only eat two meals a day. My co-founder and I are on the Paul Graham manager-maker schedule. We come in to work mid-morning (or sometimes early afternoon), schedule any meetings or other interactions to take place in the afternoon, and then work into the night. Because of this, I have lunch when I get in to the office, dinner later in the evening, then basically don't eat again until I come back the next day. For some reason it feels odd to eat a large meal after midnight, so I just don't.

I rarely eat sugar (besides fruit). I don't drink juice or soda, and we don't keep any sweets around the office. Eating simple carbohydrates causes a body to use carbs as a fuel, and makes you crave more carbohydrates. Not having this stuff around keeps my appetite from getting out of hand.

We keep the office stocked with bread, peanut butter, jelly, apples, and clementines. Occasionally, we'll also buy bulk nuts and deli meat. Nothing really sugary, no chips or snack food, or the kinds of simple carbohydrates that a person might crave. A PB&J or apple with peanut butter, or a small cup of almonds and cashews fills me up, and I'm not hungry again for hours.

During the Spring, when I was working from home and trying to get the company off the ground, I'd be working on a hard problem and wander into the kitchen to find something to snack on. Now, when I get up to pace around and think about something, the only easy snack available is fruit.

I drink lots of water and coffee. I love coffee, and drink 3-4 cups a day, sometimes more. No cream or sugar, so close to no calories there. In the evenings, I drink lots of water. This keeps the stomach full, which again, controls the appetite.

When someone takes us out to eat, or we attend a fancy dinner, or go out for drinks, I don't worry about what I'm eating, and just enjoy myself. This happens infrequently enough (once or twice a week) that it doesn't throw me off, and because of my reduced appetite, I don't go crazy when there is a lot of food in front of me.

This simple strategy of almost no sugar, low caloric intake in general, and a very limited amount of exercise has allowed me to work longer hours than I ever have in my life, and still looking and feeling fit. Consistency, not following a specific set of rules, is the key.

Photo by hibecki

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Wed, 21 Jul 2010 08:21:44 -0700 Map of my Foursquare Check-ins http://frederickcook.com/map-of-my-foursquare-check-ins http://frederickcook.com/map-of-my-foursquare-check-ins
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Fred Wilson over at AVC posted an article on how to create a map of your Foursquare check-ins. It's ridiculously easy, take a look. Here's mine.

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Wed, 30 Jun 2010 08:32:21 -0700 Many People who like NPR like Telling Dick Cheney to Shut the Hell Up http://frederickcook.com/many-people-who-like-npr-like-telling-dick-ch http://frederickcook.com/many-people-who-like-npr-like-telling-dick-ch
Telling_dick_chaney

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Thu, 28 Jan 2010 14:59:00 -0800 On Thinking http://frederickcook.com/on-thinking-3 http://frederickcook.com/on-thinking-3

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The availability of mobile devices that provide a constant stream of media is killing the creativity of my generation. This is nothing new, and there are hundreds of people out there who rant about improving productivity and efficiency by cutting down on the consumption of media.  I recommend the same thing, but for a different reason.

Thinking is a lost art.  Especially in my generation.  It’s not our fault.  From an early age, there has always been a screen flashing some kind of entertainment at us that we were allowed to use whenever we were finished producing our school work.  Producing or consuming… I’m not sure if I ever knew there was a third option.

Even in college, there was a time when I would feel like if I wasn’t either producing something or consuming something, that I was wasting time.  Time spent in production at school or work was time well spent.  Any time outside of that should be spent planning for future production, or learning by consuming media.  Even after I gave up television a couple of years ago, I still felt that I should constantly be reading books or blogs, listening to podcasts, or doing some activity from which I would learn.

It wasn’t until I started running that I realized the value of doing neither, but instead of processing the things I consumed.  In 2007, after the shooting at Virginia Tech, I started training for a marathon with a group to raise money for a memorial scholarship fund.  I would run for a little under an hour a few times a week, and longer on weekends.  I didn’t have an iPod or anything at the time, so I would just run without one.  People would ask, “What do you think about?  Don’t you get bored?”  I was anything but.  I would think about the relationships in my life.  I would think about upcoming public speaking opportunities (I was active in a lot of clubs).  I would think about assignments or papers I had to do.

Then I started noticing that all of the time I was spending on each of these things became time more efficiently spent.  My speaking points at group meetings would be more clear and concise because I had said them over and over in my head while running.  I would write an outline for a paper, then after running, it would simply flow out of me.  I would see connections between people and events that I hadn’t seen before.  In my mind, I would have a conversation with someone, and go down a hundred winding paths, all in my head.  When the conversation eventually took place, I would know exactly what I wanted to say and have responses to everything.

A few days ago, I saw Seth Godin interviewed on Mixergy.  Andrew asked him where good ideas come from, and he immediately answered, “Good ideas always come from the same place.  They come from bad ideas.”  I knew exactly what he was talking about.  A hundred businesses have started and failed in my head during my runs.  Co-founders, funding, the pivots the company will make as it grows and evolves, I see hundreds of possibilities. Two of my imaginative companies have survived and thrived.  Those two are currently getting started.

Next time you read a blog, stop afterwards and think about it, and how it applies to you.  When you are on a road trip and listen to a podcast, turn the radio completely off afterwards and think about it.  When you finish reading this, take your hands off the keyboard and mouse, turn off your iTunes, and sit back in your chair and think about it.  Go for a walk, alone, and mull it over in your head.  See where it takes you.

Image courtesy Michael Karshis, licensed under Creative Commons.

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Mon, 25 Jan 2010 19:07:46 -0800 Qwickness http://frederickcook.com/2010/01/qwickness http://frederickcook.com/2010/01/qwickness Hello all, if you haven't noticed, I've made some changes to this site.  Doran Bosso and I have launched a new blog, Qwickness.com.  Any posts on running, triathlon, nutrition, or other endurance-sport related matter will be posted there.  I will continue to blog here on other topic which interest me.  Thanks!

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Wed, 13 Jan 2010 01:52:00 -0800 VTS Gear, Rungame, and 5 Cold Weather Running Tips http://frederickcook.com/2010/01/vts-gear-rungame-and-5-cold-weather-running-tips http://frederickcook.com/2010/01/vts-gear-rungame-and-5-cold-weather-running-tips
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First, for getting fourth overall in 2009 in the Virginia Triathlon Series, Setup Events sent along some sweet schwag: a jacket (with my name monogrammed on the back of the collar), a cap, and some arm warmers, all with VTS logos. Thanks, VTS, you guys do great events!

Next, with Rungame, I have done 11 runs in the first 12 days of 2010, putting me one run behind. (Last Saturday, I was at Wisp in western Maryland, and it snowed for two days straight before we got there, so I skied for 8 hours that day and didn't get a run in.) One day this week will have to be a double. So far though, I have run for 8 hours 35 minutes in the last 12 days. I haven't kept track of distance, but if I had to guess, somewhere between 55 and 60 miles total. Not huge, but I'm quite happy with that for this time of the year and these conditions.

Now, a few Cold Weather Running Tips I have picked up over the last few days:

1. Good socks are key. You can always put more layers on your top, or a pair of sweatpants on over your running tights, but because most running shoes are designed to be "ventilated," socks are incredibly important. Bonus tip: if it is above freezing and raining or wet out, put sandwich bags over your socks before you put your shoes on. Once your toes get wet, your run goes downhill quick. Bonus tip two: if you don't have good gloves, just pull your sleeves over your hands. All the pros do it.

2. Hold yourself accountable by telling others. I am a huge believer in publicly stating goals. I told all my readers that I was going to do these runs, so if I don't, I'm accountable to you. If I hadn't done that, it would have been very difficult to get out the door. Tell someone whose opinion you value that you are going to run X number of times this week, and ask them to check back with you.

3. Short and consistent trumps less longer runs. The boost to your metabolism that you will get from doing something on a regular basis outweighs the fitness you may gain from pushing yourself to run longer. Also, with shorter runs, you obviously won't have as much time to get cold.

4. Take it easy. Remember that there is a huge range of heart rates between resting (sitting at a desk) and huffing and puffing. Especially this time of the year, the fitness to be gained by going hard is likely not worth the risk of injury. You have more to gain by staying in your lower-intensity fat burning zone. Bring your body to a pace where you are just about to start breathing hard, then back off a tiny bit. Bonus tip: running on busy streets or trails creates pressure to push harder because of the perception that people are watching and judging you. Find less crowded areas. (But stay safe.)

5. Enjoy yourself. Leave the iPod at home, and take in the crisp, cold, fresh air. There are too few times in the modern American lifestyle that a person will allow them self to be alone in their own head. Embrace it. I'll write a whole post about this sometime soon.

Now get out there.

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Sat, 02 Jan 2010 16:18:00 -0800 Diet Tips for the New Year http://frederickcook.com/2010/01/diet-tips-for-the-new-year http://frederickcook.com/2010/01/diet-tips-for-the-new-year I was talking to a friend last night who was disappointed with himself over putting on some weight over the last year or so. This got me thinking about what strategies I have used to find a sustainable place with my body weight.

In November, after finishing Ironman Florida I started focusing on finishing my thesis, and went from about 10 or so workouts per week to about 3-4. However, because of some simple diet strategies, this reduction in workouts hasn't caused me to gain more than a pound or two. Here's how:

Learn to say no. It is absolutely impossible to be in control of your diet if you eat everything that is put in front of you. Visiting friends, at the office, wherever, there is always food available, and until you start saying no to certain foods, your diet will be controlled by your circumstances.

Plan your meals. I'm not saying to schedule on your calendar what you are going to eat each day, or even that you have to cook for yourself. If you leave the house to go to the office in the morning and haven't thought through where your next meal is coming from, you are much more likely to get fast food or eat whatever is convenient, which is much more likely to be an unhealthy option. Even if you don't bring something, make some kind of plan for finding a healthy meal.

Consistency counts. Going to a friend's house to watch football and eating chips and dip and having a couple of beers isn't what is going to make you fat. What you eat for breakfast, lunch, and dinner those other five days of the week is. You don't have to order a salad every time you go out to lunch with friends, but when you're by yourself, make sure healthier options are available.

Make your diet a priority in your life. You don't have to obsess over it, just keep it in mind. You know you are going to be hungry every few hours. Make sure that there are healthy options available, or you are a slave to food that is convenient.

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook
Fri, 01 Jan 2010 18:00:00 -0800 Rungame: 30 runs in 30 days in January http://frederickcook.com/2010/01/rungame-30-runs-in-30-days-in-january http://frederickcook.com/2010/01/rungame-30-runs-in-30-days-in-january Since Ironman Florida on Nov. 7, I have done a ton of yoga, about four runs, and two swims. Most of November and all of December was spent finishing my masters thesis, which I defend on January 4.

To get back into training shape and to kick off the new year, I will be taking part in a game devised by some folks at Endurance Corner (Gordo's group). One of their guys, Dr. Jeff Shilt, describes the game here.

Basically, starting today, Jan. 1, participants run 30 times in the next 30 days. Not long runs or hard runs, though I am setting myself a minimum of 40 minutes. I can "bank" a day by doing two runs, though they have to be in two different sessions. Gordo set up a Google Documents page to record the runs.

If you want to participate, feel free to check out the link, or just keep track of it yourself. If you're new to running, set yourself a lower minimum, like 15 or 20 minutes. Two miles a day for 30 days is a pretty good month for someone who isn't working out a lot. If anyone reads this and decides to do it, send me an email or comment, I'd love to hear about it.

Happy New Year!

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http://files.posterous.com/user_profile_pics/781207/fred_bio_pic.png http://posterous.com/users/3syhnrw3b0NH Frederick Cook Fred Frederick Cook