Software patents
My friends at USV and Brad Feld are pushing for patent reform or doing away with software patents wholesale. I encourage you to read Brad Burnhams post and Brad Felds follow up here. Brad Feld has been passionate about this topic for some time and sent me the book “Math You Can’t Use” last year.
There is a compelling argument for this push. The trolls are busier than ever and we are also seeing our portfolio companies spend precious capital defending themselves against these legal attacks without merit.
Trolls are just one end the spectrum. On the other end, patents also favor big companies. In 2007 IBM proudly announced they received 3000 patents for the year.
In my experience, filing a patent costs about $10k and that’s just for the US. In order to receive 3k patents a year, consider how much they spend since some percentage of their applications are either rejected or require modifications. Those 3k patents alone required well over $30M. How many do you think they file per year?
This isn’t a sport for startups or young companies.
The patent system seems to be geared towards trolls or mega corporations. Is that best for the innovation economy ?
We need a better system.
I’m still not convinced I have the answer and ideally the best answer doesn’t require the courts to decide each time. That only helps big companies who can litigate forever.
(btw, this is the same logic I have regarding employee non compete agreements. I just want to get rid of them wholesale so the courts don’t have to deal with them each time.)
This an important issue and I look forward to getting smarter about it.
A little color behind my ‘crazy mode’ comment
Last week, Scott Kirsner organized a dinner over at Microsoft in Cambridge.
It was a nice get together with a number of old and new friends. Everyone at the table is focused on improving the local tech scene in their own passionate way. We all shared our respective efforts. It was wonderful to hear what everyone was working on.
Bill Warner is an inspiration. He is doing more than his part by being a successful entrepreneur, tireless leader, angel investor, conference organizer, industry ninja and the heart of TechStars Boston. I feel like a lazy slog every time I see Bill.
Jeff Bussgang is driving a number of things including Stay in MA. David Beisel started and runs WebInno. Kate Imbach runs MobileMonday. Nabeel and I got OpenCoffee Cambridge going. I’m trying to get rid of non-compete agreements in this state. Shawn Broderick, Tim Rowe & everyone else at the dinner is pushing their own efforts in a super positive direction. And the collective impact is tremendous. Things are happening in this town.
On Friday, Scott wrote up his thoughts from the dinner in Boston Globe. I made a comment over the dinner that Scott shared in his article:
“Bijan Sabet of Spark Capital said that one way to invigorate the start-up ecosystem here, and perhaps even create big companies in emerging industries, is to go into “crazy mode,” funding all kinds of ideas — some of which may seem nutty or insignificant. Some may just need $10,000 to get going, not $10 million.”
I’d like to explain that one a bit.
Over dinner someone made a comment in response to seed incubator programs like YC and TechStars and stated we were funding “feature companies” and we need provide “tough love” instead of being a cheerleader for these startups.
And that’s when I blurted out my “crazy mode” line. Because I couldn’t disagree more with that sentiment actually.
I want to see local VCs and angels fund more YC and TechStars startups - not less.
Many early/seed stage web startups begin life focused on solving one simple thing and in a capital efficient manner. In reality they have no choice. Yet, if they can nail it, they can start building tremendous value. And their capital efficiency is a gift to everyone. We should do more of this not less.
Pefect example: Dropbox was a YC seed funded company. I think most missed Dropbox because in the early early days of the company it probably was considered a feature or something Google/Microsoft/Apple/xyz big company could do overnight. Plus there were a number of competitors in the market.
The idea might be conceptually simple but they nailed the user experience which is everything and definitely not simple. The technology just works. Dropbox may have started life with a small seed but they have become an amazing company and have built a killer product with a solid business model.
Many successful consumer web startups began as capital efficient startups focused on nailing one thing. Consider Facebook, Twitter, digg, linkedin, craigslist, flickr….I could go on. Imagine what they looked like on day 1. In the early days they might look like features or even toys.
With all of that in my head, I instinctively threw out my “crazy mode” comment.
If I could take it back, I would.
Because I dont’ believe funding these companies is crazy.
It’s the future.
Running Google Voice on the iPhone
For some time now, I was using an iPhone as my one and only phone.
But the battery life and AT&T coverage was bumming me out.
So a few months ago, I bought a Verizon Blackberry Tour. And since then I’ve been carrying around two devices. I use the Blackberry for voice/SMS/email and the iPhone for browser/ipod/camera/apps.
This combo has some nice benefits. The immediate one is that I no longer feel guilty or stress about battery issues on the iPhone. In the old days I would avoid listening to music on the road because I didn’t want to drain the battery. And Verizon’s network is sweet.
The downside of the two phones thing is voice and sms portability. There are times when I’m running around town with the kids and I don’t want to carry two phones. I just want the iPhone. Google Voice is the perfect solution but that app was blocked by Apple.
This morning, I took the steps and hacked my iPhone by following the directions here.
After I did the jailbreak, I was able to install GV Mobile on my iPhone. Now I have Google Voice running on my iPhone and my Blackberry. Works like a charm.
I’m going to test this setup for a few weeks. If this works well, then I will need to update my contacts with my new GV number. It will be a one time hassle but I think it’s worth it.
Can a startup build the next great CE device?
Much has been written about capital efficient startups. Needless to say, I’m a big fan.
Typically, capital efficient startups come in two different flavors:
1 - One type are those that burn little/modest capital in the first stage (generally 0-2 years) while at the same time learning a lot and creating signficant value. At that point, they can raise follow on rounds (for growth, ad sales, staffing, scale, whatever) at a higher price which is good for all inside shareholders and also reduces the risk for the new investors.
2 - The other type are capital efficient companies that reach profitablity with little invested capital and then can grow from profits.
I’ve seen startups come in both configurations and it’s a beautiful thing. We have a number of them in our portfolio and I am confident we will continue to invest in capital efficient startups.
But over the break, i’ve been thinking about companies that require signficant capital upfront — before they prove anything or reach any meaningful milestone.
Specifically, I’ve been thinking about consumer electronics. In our world of capital efficiency, is it possible for a startup to build our next generation phone, television, tablet, ereader or game console? Or do we all have to wait for Google, Microsoft and Apple to make these things? Are big co’s the only ones that can innovate and bring these products to market?
I believe that startups can build these things. Just look at Tesla for inspiration.
It’s going to take a special combination of entrepreneurs, operating excellence, capital and audacity. But it can happen.
And I hope we can invest in some of them - in addition to our capital efficient tech startups.
My Apple netbook
As I look back on 2009, my calendar (and my body) serve as a reminder that I traveled a ton. And I don’t see that changing in 2010.
So I bought a new MacBook Air this weekend. It has a 128gig solid state drive. It’s super light, quiet and smooth. I’m going to use this strictly as my travel computer not as my main computer at the office. (I wouldn’t recommend using this as your primary computer).
In a way it’s my netbook. This is how wikipedia describes a netbook:
Netbooks (sometimes also called mini notebooks or ultraportable) are a branch of subnotebooks, a rapidly evolving category of small, light and inexpensive laptop computers suited for general computing and accessing web-based applications; they are often marketed as “companion devices,” that is, to augment a user’s other computer access
The MacBook Air fits that description except for the inexpensive part. But Moore’s law will win that fight.
Since the local storage is relatively small, I decided to use this machine very differently than my other computers.
-the vast majority of my data stored in the cloud (email, documents, photos, music, etc)
-primarily using only two desktop apps: Chrome and Dropbox
-gmail for personal email and msft outlook web access to for my work stuff
-the web gives me my music fix so I don’t need local storage or apps for that
-photos all goto flickr for archive & backup. my favorite pix goto tumblr
-if i need to do anything creative with my digital work, I’ll take it to Aviary
-any thing that i happen to download goes to dropbox which automagically ends up on my heavy duty Macs. those items get backed up and/or syncd to the iphone.
-I’m not going to install MSFT Office on this computer. I think I’ll be more than fine with Google Docs and Apple iWork as a backup. This will be my first business machine without Office.
Let’s see how this experiment goes. I’m optimistic.
