You probably already know that John Chambers, chairman and CEO of Cisco Systems, likes big numbers. Today in a keynote at the 2014 International CES in Las Vegas, he may have picked his biggest number ever.
He pegged the value of the evolving Internet of Things (IoT) — or Internet of Everything, as Cisco calls it — at $ 19 trillion.
In collaboration with GigaOm and TechCrunch, VentureBeat is excited to announce the finalists for the 2013 Crunchies awards!
We combed through thousands of your submissions and put them together with the vast expertise of our three sites’ editors to come up with this list. The nominees on this list are some of the most impressive companies and people the tech world had to offer in the past year.
Check out our finalists in all 20 categories below, ranging from FastestRising Startup to CEO of the Year. And congratulations to every one of them for making it to this exclusive list.
Now we need you to vote on the finalists! Head over to the 2013Crunchiesvoting page and tell us which is your favorite in each category. Keep in mind that you may only vote once per day per award category until voting closes on Sunday, January 26, 2014, at 11:59 p.m. PST.
Winners will be announced onstage at the 7th Annual Crunchies.
The award show will take place on Monday, February 10, at 7:30 p.m. followed by the after party from 9:00pm to 11:30 p.m. at Davies Symphony Hall, 201 Van Ness Ave, San Francisco. You can purchase tickets here. Be sure to act fast!
Amy likes to remind me that when I was an entrepreneur, I used to regularly give talks at MIT about entrepreneurship. I’d say — very bluntly — “Stay away from VCs.” I bootstrapped my first company and, while we did a lot of work for VCs, I liked taking money from them as “revenue” (where they paid Feld Technologies for our services) rather than as investment.
Feld Technologies was acquired in November 1993. Over the next two years, I made 40 angel investments with the money I made from the sale of the company. At one point in the process, I was down to under $ 100,000 in the bank, with the vast majority of our net worth tied up in these angel investments and a house that we bought in Boulder. Fortunately, Amy was mellow about this. We had enough current income to live the way we wanted, we were young (30), and generally weren’t anxious about how much liquid cash we had.
Along the way, a number of the companies I had invested in as an angel investor raised money from VCs. Some were tough experiences for me, like NetGenesis, which was the first angel investment I made. I was chairman from inception until shortly after the $ 4m VC round the company raised two years into its life. Shortly after that VC investment, the VCs hired a new “professional” CEO who lasted less than a year before being replaced by a CEO who then did a great job building the company. During this period, the founding CEO left, and I decided to resign from the board because I didn’t support the process of replacing this CEO and felt like I no longer had any influence on the company — and I wasn’t having any fun.
But I still wasn’t a VC at this point. I was making angel investments with my own money and working my ass off helping get a few companies that I’d co-founded, like Interliant and Email Publishing, off the ground. I was living in Boulder at this point, but traveling continuously to Boston, New York, San Francisco, and Seattle, where I was making most of my investments. During this time, I started to get pulled into more conversations with VCs, helping a few do some diligence on new investments, encouraging some to look at my angel investments, and investing small amounts in some VC funds whenever I was invited to invest in their “side funds for entrepreneurs.”
One of the VCs I overlapped with while in Boston was Charley Lax. Charley was a partner at a firm called VIMAC and was looking at some Internet stuff. I was one of the most prolific Internet angel investors in Boston at this point (1994 to 1995), so our paths crossed periodically. We never invested in anything together, but after I moved to Boulder, I got a call from Charley one day in early 1996. It went something like:
“Hey, I just joined this Japanese company called SoftBank, and we are going to invest $ 500 million in Internetcompanies in the next year. Do you want to help out?”
Um, ok, sure. I didn’t really know what help out meant, but on my next trip to San Francisco I had a breakfast meeting with Gary Rieschel and Jerry Yang. SoftBank had recently invested in Yahoo, and presumably the breakfast was to vet me. I remember it being pleasant and ending with Gary saying something like “welcome to the team.”
I still didn’t really have any idea what was going on, but I was making angel investments and having fun. Charley proposed being a “SOFTBANK Affiliate” which had a small monthly retainer, a deal fee for anything I brought in, and a carry on the performance of any investments I sourced. Informal enough for me to play around with it for a while.
I was in Boston the following week so Charley emailed me and said, “Can you go check out this company Yoyodyne and tell me what you think?” I went to a generic office park near Boston and met with two people who would become close friends to this day. The first was Fred Wilson, who had just started Flatiron Partners (SoftBank was an investor in Fred’s fund), and the other was Seth Godin, the CEO of Yoyodyne. I vaguely remember a fun, energetic chat as we met a few people at Yoyodyne, ran through the products, and talked about how amazing the Internet and email were going to be as marketing tools.
My formal report back to Charley was short — something like “Seth’s cool; the business is neat; I like it.” SoftBank and Flatiron closed an investment in Yoyodyne a few weeks later.
Suddenly I was a VC. An accidental one. And it’s been very interesting since that point back in 1996.
Entrepreneurs are the artists of the business world — captivated by ideas and the never ending pursuit of the potential—the what if. If 2013 has taught entrepreneurs one thing, it’s to focus on the passion behind the art and leave the menial tasks up to technology. Here are 10 apps from 2013 that have helped lighten the load of the business minded and allowed them to focus on what really matters, the creation.
1. Evernote Business
With the business Evernote app users can automatically share their latest content with team members in order to create team effort and collaboration. The best part about Evernote Business? In just one click, users can transform Evernote content into an immediate presentation. So, whether users need to present to a large group or a small group, a presentation is just one click away.
For the entrepreneur who is always looking for new innovations and wants to stay up on the latest news in their industry, Digg is the perfect app to download on phones, tablets, and e-readers. Digg allows users to find, read, and share the top trending stories on the internet all in one place.
3. Smartr Contacts
Every business owner and developer understands that having strong contacts is one of the most fundamental parts of the field. Smartr Contacts allows users to find their most important business contacts instantly. By delving into social network contacts, phone contacts, and email accounts, Smart Contacts instantly searches for the contact the user is looking for.
Stay on top of business finances and send invoices in just minutes with Invoice2go. Once users have created an invoice, Invoice2Go will send a prompt to mark the invoice as either paid or unpaid. Create instant reports to show unpaid balances, and send reminders to debtors immediately from your phone of tablet.
The days of the filing cabinet are long gone, but somehow people still manage to get their files mixed up and confused. Dropbox is a service that allows users to store all of their files in a cloud and access them anywhere or at anytime. With quick uploading time and a simple interface, Dropbox will leave users headache free and ready to feel organized.
Clickyallowsentrepreneurs and business owners to analyze their website stats on the go and stay up to date with the latest Google trends and algorithms. Clicky allows users to monitor every action taken on their website, while providing the ability to personalize relationships with users by inputting custom data such as usernames or email addresses. Onsite analytics and Google Search Ratings have never been more accessible.
Entrepreneurs can update their team on the latest updates in their industry with the Prismatic app. Catered to user’s interests, Prismatic displays articles on a one-page news feed. The perk to Prismatic? Upon liking or disliking an article in the news feed, an algorithm is created to attract the users content and what they are more inclined to like.
Producteev is the perfect app to helpentrepreneurs delegate and complete tasks with their teams. Assign tasks, add due dates, track progress, and measure the end results with this app. The best part about Producteev? It allows users to manage projects and tasks at an organizational pace that is catered to the users needs and wants.
9. Easy Projects
Easy Projects is a management software app that allows users to make online planning the solution to all of their organizational needs. Export and import from MS Project and MS Excell. Easy project is the solution to management tasks by allowing users to manage and plan tasks, use interactive Gantt charts, and incorporate a time-management module to ensure that every time spent on certain projects is being billed and accounted for.
Entrepreneurs would agree that note taking and jotting down ideas is one of the greatest vessels of inspiration. Vesper is one of the most intuitive note taking apps. Users can write text, add images and text, and with Vespers easy navigation sidebar, users can easily find all of their notes later on.
From planning meetings to organizing funding—the life of an entrepreneur is taxing. From note taking to tracking productivity, these 10 apps will allow entrepreneurs and business owners to focus on their most pressing project, and leave the smaller tasks to smartphones and tablets.
Edward Lakatis is CEO of Zapporoo, an app design company. He is passionate about all things related to app design and concepts. He loves to help entrepreneurs bring their apps to market.
Vkontakte, a social networking site known as the “Facebook of Russia”, is facing legal action from nine music labels including EMI, Sony and Warner over what they claim is the unlawful distribution of some 6,000 tracks of licensed music on the site from artists like Madonna, Linkin Park, Metallica and Beyonce. The lawsuits are being prepared for filing after the holidays, according to the Russian newspaper Izvestia.
Pavel Durov, the founder and CEO of Vkontakte, says the site is prepared to negotiate with them, as it has with video rightsholders. “If some musiccompanies wish their content to be deleted from VK, we, as always, are willing to comply with their wish,” he told TechCrunch. “On the other hand, we are also ready to seek mutually beneficial ways to monetize their content. This year we managed to find such a solution for video content and we are optimistic about the audio section of VK as well.
“Of course, if no agreement with large record companies is reached, their content will be deleted and VKmusic service will rely mostly on independent artists.”
If the suits go ahead, they look like they may be some of the first big moves from music rightsholders to go after a major site in the wake of a new anti-piracy law in the country designed to protect copyright better.
That law originally was aimed to focus more on video content but there are some who hope to extend it to include music. The law enforces improved communication by requiring site owners to provide easy-to-find contact details, including real-world addresses, and forms for rightsholders to file complaints faster. If a site fails to comply with an infringement complaint, it faces a block at the ISP level.
Leonid Agronov, the head of Russia’s National Federation of the Music Industry (Russia’s RIAA), told Izvestia that his organization has long been trying to negotiate with Vkontakte over music distributed through its site. The NFMI claims that Vkontakte does not pay for streamed plays, neither by charging users directly nor by paying the licensing fee directly. But that does not mean that the social network is not profiting.
“[Vkontakte] shows ads while people listen to music. So they make money on it,” he said.
In the case of removing these tracks, it puts Vkontakte in a double bind, where it’s damned if it doesn’t and damned if it does: on the one hand, it risks legal action from larger companies and potential ISP blockage; on the other, it faces backlash from its users, who look to it as a content portal.
This is not Vkontakte’s first brush with copyright holders. Izvestia notes that in June of this year, the site — which has become a go-to place for users in Russia for music and other digital content sharing (including a lot of legal content) — took down some 7,000 music tracks. Then in August, Vkontakte signed a deal with UK monitoring company Muso to track and remove illegal music from the site. Muso’s CTO and co-founder James Mason tells me that it continues to work with Vkontakte to take down free music that infringes the copyright rightsholders that Muso represents.
“Over the years VK has become the principal tool for music discovery among Russian-speaking population,” Durvo says. “As a result, there are plenty of artists and musiccompanies that use VK as the main way to promote their work. We hope that more and more talented artists will get exposure with the use of our music service.”
In January 2012, Vkontakte lost a case against Russian label Gala, which said the site was allowing users to upload and share tracks by Russianartists in breach of copyright law. It was fined $ 7,000. It has won other cases, such as a case against Russian label Soyuz this past October, again over copyright.
It is also not Vkontakte’s first brush with Russian legal forces. In May this year, the Russian regulator Roskomnadzor blocked the site. Although it claimed to have done this by mistake, the move was a bit close to the bone, considering that the site has been a strong advocate of free speech, including content critical of the government. One of the social network’s investors, United Capital Partners, has ties to the Kremlin. It picked up its stake in Vkontakte in a secondary sale.
Russia is Europe’s biggest internet market with over 61 million users. But it also has the more dubious distinction of being one of the worst repeat offenders globally when it comes to digital content copyright infringement. That has been one of the big gating factors for legit services to enter the market — not least because those businesses may actually find it hard to find paying users, when free (but illegal) content is so easy to get.
But with companies like Apple finally launching iTunes in the country, the tides are slowly shifting — something regulators have been hoping to encourage with anti-piracy legislation.
According to analysts at TNS, Vkontakte is one of the most visited sites in Russia, overall coming in third after portals like Mail.ru and Yandex (which each account for some 30 aggregated URLs). Looking specifically at Moscow, Russia’s biggest and pace-setting market, Vkontakte is the leader among under-24s and third in the 25-34 age bracket:
In this particular case, which will be filed in court in St Petersburg (where Vkontakte is based), the plaintiff group includes a mix of international and Russian labels: Sony, Universal Music, Warner Music, EMI, Gala, Navigator, Studio Soyuz and Nikitin Media. The case could last between a couple of months and two years, Izvestia writes.
Updated with comment from Vkontakte CEO Pavel Durov and Muso CTO James Mason.
This is a guest post by Vanessa Camones, founder and CEO of theMix agency.
The tech boom is transforming every business it touches, but it doesn’t seem to be helping a core part of the industry: Public relations for tech companies. By and large, PR hasn’t adjusted to the rapid shifts of the digital era, and as their top clients in tech succeed (or at least enjoy the bubble), they themselves strain to stay relevant. Worse, this is hurting the thousands of startups desperate to get traction for their product and brand amid a market oversaturated with competition. The problem is so dramatic, top venture firms have even tried to replace traditional PR with their own PR platforms. In my view, however, that’s only a temporary bandage on top a much deeper wound: When it comes to tech in particular, traditional PR is fundamentally broken, beyond repair, and losing its relevance in real time. The sooner struggling startups realize this, the better.
Here’s some symptoms to the problem as I see it:
Yes Men PR Firms Not Adjusting to Social Media
Over the last few decades, traditional PR agencies have developed a Voice of God/humble servant relationship with their clients, treating their words and opinions as sacred, rarely to be challenged. But in the social media context, where a company announcement can be undermined in a matter of hours, this is self-destructive for both sides. Consider what Twitter did recently, announcing changes to their blocking policy, only to encounter instant, pervasive user backlash, to the point where the company quickly reversed itself. You see this pattern time and time again in tech — a feature goes out, there’s a PR nightmare, and the company backtracks. Clearly their PRfirms aren’t warning them about these impending disasters, or briefing them on common communication mistakes — or the companies themselves aren’t listening to their counsel in the first place. And while established players like Twitter can weather social media-fueled user revolts, they can be disastrous for smaller startups.
Take OUYA: The indie videogame console started with a hugely successful Kickstarter and a dedicated fan base eager to become its evangelists. But after release delays and poor communications with its most passionate backersand developers, the brand largely became poisoned on influential social sites like Reddit. I admire OUYA founder Julie Uhrman and hope her product can recover its luster, but am also pained at all the squandered opportunities lost by the speed of social media.
In any case, most startups tend to work with PR only for press releases and product launches — which takes me to my next two points:
Tech Press Releases Generally Don’t Drive Conversions
Many startup CEOs assume that announcing their new service or app with a press release is key to their launch, but as I must often explain to them, press releases per se rarely drive actual user conversions. That’s true even if the release is picked up and featured in a post by a top tech news site: While several million readers may skim the post about your app, only a fraction will bother clicking the actual App Store link, and only a fraction of them will install the app, let alone use it more than once. This problem is compounded by the sheer excess of tech press releases put out on the wires every day, choked over with generic product descriptions and executive quotes which sound like no human ever, and blatant SEO keyword scheming — the latter, in part, causing Google to change its policy on press releases altogether, making them even less relevant.
To be sure, press releases serve a purpose as a legal/investment formality, but that’s very different from actually trying to tell a narrative. If you have a good product, you should be telling its story through a video, a blog post, and an ongoing conversation in your social media channels. But “ongoing conversation” isn’t typically part of a PR firm’s DNA, or what startups expect of them.
Startups and Their PR firms Don’t (Generally) Value Social Media and Content Strategy
As we saw with the rise of blogs and now the growth of “linkbait” posts, content that’s emotionally engaging and immersive is what works in today’s ecosystem: Stories that people can understand in a simple, straightforward context. The same is generally true for content around products and companies, but that’s the most difficult kind of writing to do well. It’s best expressed not in press releases, but via blog posts, online video, and social network updates. However, most PR companies weren’t prepared for the shift that social media caused, and have been slow to integrate it into their core capabilities. So they also don’t understand how to manage and create conversations — an absolute necessity for real-time marketing — while companies big and small don’t understand how to fit social media as a layer into their existing content strategy. (According to an Altimeter Group report, only 1 in 4 companies approach social media holistically; according to Context Marketing research, 49% of B2B marketers still don’t even have a content strategy.) Consequently, tech PR is placed in a single silo, and any coverage earned for their clients is relegated to a single press bump without a broader context.
All this is probably a major reason why recent attempts to revamp startup-based PR don’t seem to be returning significant results. HackPR was supposed to transform traditional PR, but we haven’t heard much about it since its launch last year. (Ironically making it a likely case study in one-hit wonder coverage — itself a typical PR problem for startups!) The same might be said about AirPR, which first launched as as “Match.com for PR”, but now seems to be pivoting to become an analytics-for-PR service.
The good news is that traditional PRfirms are starting to change, and integrate content strategy into their services. Top agency Edelman just added a content arm, as did Weber Shandwick. Both represent some of the world’s biggest brands, and it’ll be interesting to see how their strategy adjusts to include content. At the same time, powerful social sharing platforms like Pluck, Percolate, and Socialeddy can help PR/marketing teams manage their channels, while also giving them the data to measure success, so they can build a case internally for continuing to support an entire integrated comms strategy.
Small startups, however, may not see these shifts soon enough to benefit from them. But based on past experience, I’m confident the best ones are agile enough to thrive in the tech industry’s post-PR agency future.
Vanessa Camones is the founder and CEO of theMix agency, a full-service marketing and communications boutique.
When it comes to the emergent world of on-demand transportation, Lyft and Uber have been capturing the lion’s share of headlines of late, seemingly deadlocked in a race to become the clear “market leader” in a hot space that’s rife with competition. Of course, with startups like Hailo and SideCar and riding the same rising tide, there are more than a few startups looking to throw their name in the hat.
As part of its expansion into the U.S., and in effort to differentiate itself from the pack, GetTaxi has taken on a new look since August. For starters, it’s rebranded its U.S. branch and is now operating under the brand Gett at Gett.com. Secondly, although NYC has cleared the way for “e-hail” taxi services after fighting them tooth-and-nail, Gett has decided to drop its taxi service in NYC.
According to co-founder and CEO Jing Wang Herman, it became apparent that, in spite of the efforts of services like Hailo, yellow cab-like on-demand services in New York City just don’t make sense. At least not yet. The proliferation of yellow cabs in the Big Apple has meant that too many drivers found that passengers weren’t showing up because they were able to find a ride on the street first.
So, after dropping their cab service in NYC, Gett has decided to take on Uber and many others operating “black car” businesses by focusing on offering pricing that’s both predictable and affordable. The company is trying to offer a payment structure, Herman says, which makes sense for both drivers and passengers, while establishing Gett as a more affordable option when compared to some of its better established competitors.
In addition, Gett offers flat fares between neighborhoods regardless of time spent in the car or distance traveled, and avoids the lure of surge pricing, a model oft-employed by Uber. The company also launched a “future booking feature,” which allows riders to not only order a black car on-demand for immediate pick-up, but schedule a future ride as well — up to two weeks ahead of time.
Furthermore, Gett is not only finding success catering to corporate clients (with 1,500 corporate clients in 20 cities, including Google and Morgan Stanley), but the company is hoping that by further expanding beyond the traditional on-demand transportation model, it can tap into another parallel area of demand. And add an additional revenue stream to support its black car service in the U.S.
Herman tells us that Gett believes that, by slowly adding a delivery service on top of its existing operation, it could have an ace up its sleeve. The startup began to test an on-demand delivery service over the holidays (beginning in mid-November) by offering to pick up toy donations from any address within New York City on-demand or pre-scheduled through its mobile app, in partnership with Toys for Tots.
With its charitable toy delivery promotion having found traction, the company says that it will be looking to significantly expand its on-demand delivery service in the coming year, with its network of drivers providing the foundation for the new extension of its model.
As to its success in NYC, Herman tells TechCrunch that it has attracted over 100,000 customers in New York City alone since launching, adding to its million-plus users around the world. The GettCEO also claims that, thanks to its enterprise accounts in other countries, the company now has the highest margins of all transportation apps. He claims that Gett is now operating between 20 to 30 percent margins compared to Hailo at 10 percent and Uber at 20 percent, though we’re still waiting for verification on this from competing services.
Furthermore, Gett appears to now be rivaling Lyft in the revenue department, as the CEO says that the company achieved a gross revenue run rate of more than $ 100 million in December. Furthermore, he says that the business is now “profitable in its first 20 cities” — even though Gett’s current total of $ 42 million in funding remains half of what Lyft has claimed from Andreessen Horowitz and others at $ 82.5 million.
The CEO tells TechCrunch that he sees New York City as the key area of opportunity for the company’s growth going forward and will be going “all in on NYC next year.” Demand has been doubling every month since launch, he says, and the company will soon have 1,000 cars operating on the streets — which he expects to significantly increase in early 2014. With Lyft currently absent in the NYC market and Sidecar having shut down, the CEO says that he wants to turn the perceived Lyft vs. Uber battle in the U.S. into a more focused battle between Gett and Uber in New York City.
To do so, Gett launched a new version of its app for iOS this week (and updated Android and Blackberry as well), bringing a slick, redesigned interface to its mobile experience, including, among other things, a new interactive mapping feature.
The company has also remodeled the app’s search functionality to offer better results and faster navigation, particularly when it comes to contextual results. In particular, the new app makes it much easier to search for points of interest nearby, for airports by terminal, as well as for hotels and restaurants.
The app is also now compatible with iOS 7 and the latest iterations of Android and, Shelly Palmer at the very least, thinks that the new app makes Uber look like “sticks and crossbows.” (Whatever that means.)
It’s still early for on-demand transportation companies, in New York City especially, and it’s not clear whether Gett’s impending delivery service will be an intelligent extension to its business or a distracting gamble. However, judging by current growth across its first 20 markets, Gett might soon be making a case for the addition of its name to the race for dominance in the on-demand transportation market.
Indian streaming music startup Dhingana faces an uncertain future after T-Series, its biggest music label partner, said it will not be renewing their licensing agreement.
Soundbox reported last week, and T-Series president Neeraj Kalyan confirmed to TechCrunch, that the company will not renew the license set to expire for nearly 8,000 songs from Dhingana’s catalogue. “We were not able to see much traction in the service and secondly we couldn’t agree on the commercials and both parties thus decided to part ways in an amicable manner,” said Kalyan.
However, it looks more like a near-death experience for the musicservice and not an imminent shutdown. DhinganaCEO Rohit Bhatia said that any new developments will be shared this week. He declined to comment on whether Dhingana will indeed shut down.
Any recovery from T-Series ending its licensing agreement would depend on whether Dhingana can overcome the hurdles of poor ad rates, rampant music piracy, and rising costs of supporting its free service in the country — issues facing every streaming service in the country.
Dhingana is among the top-funded musicstartups in India. It raised $ 7 million in Series B funding in October last year from Lightspeed Venture Partners, Inventus Capital Partners and Helion Venture Partners. Bhatia told Medianama that Dhingana is in the process of restructuring its operations.
Dev Khare of Lightspeed declined to comment on Dhingana, and executives at Inventus Capital (another investor in Dhingana), also refused to comment.
Another source, a musicindustry executive familiar with Dhingana’s negotiations with T-Series said Dhingana didn’t agree to the music label’s commercial terms and more importantly, was running out of money. “T-Series’ exit is a trigger, but Dhingana’s problems are much beyond that,” this person said over the weekend.
The Challenges Facing Music Streaming In India
Earlier this year, India’s largest e-commerce company Flipkart shut down Flyte, its digital music store, citing piracy and complex payment mechanisms among the top reasons for the decision.
Whether or not Dhingana shuts down, being a pure-play streaming music startup in India is going to get tougher for sure.
There are some big challenges facing both the free streaming and the pay-for-download models in India — musicpiracy is clearly the toughest to battle, with most consumers still preferring to download free music from illegal sites like http://www.songs.pk. The other challenge is that most big musiclabels demand stiff fees for awarding any digital music rights apart from the per-stream cost for each of the songs.
The recent Bollywood hit Chennai Express for instance, sold music rights for an estimated $ 2 million. The musiclabels want bang for their bucks and they cannot achieve that by being too generous in their commercial arrangements with the streaming services.
The Holy Grail for all these musicstartups is to reach a scale where they are more comparable with a Spotify. But as the CEO of one of the musicstartups in India told me over the weekend, becoming a Spotify will require very deep pockets, enormously patient investors and, above all, an industry where more consumers are willing to pay for legal music downloads. Unfortunately, that’s not the case. India’s media and entertainment industry loses about $ 4 billion every year due to copyright infringement.
Telecom operators like Vodafone on one hand, and aggressive Internet platforms like YouTube on the other, are threatening to hit these pure play musicstartups very hard. YouTube’s rumored music streaming service on top of what it already offers is set to put more pressure on advertisers to increase their ad spending with Google.
So will other music-streaming services face this ‘loss of faith’ from music labels?
Gaana.com (backed by Times Internet Ltd) and Saavn (the Spotify for Indian music), continue to survive and even expand their services, thanks to the deep pockets and some innovative business models. Their success (so far) also reflects that the digital music scene in India may not be so gloomy after all. Gaana has around 7.5 million monthly active users.
Satyan Gajwani CEO of Times Internet, which owns Ganna, said the focus is more on building consumer habit of paying for legal music.
“We have started to convert free users into paid ones, but our primary goal today is to build the habit of using Gaana before piracy, and we are confident over time of converting free users into paid ones,” he added.
SaavnCEO Vin Bhat told me that despite challenges of musicpiracy and competition from Google’s YouTube in getting a bigger share of the ad market, there’s a large addressable market in India. Already, almost half of Saavn’s 11 million monthly active user base is from India, and it’s growing.
Kalyan of T-Series added that it will continue to work with Saavn, Gaana and others, as these platforms continue to show good traction.
“The streaming business has to slowly move from free economy to paid economy as sustainability of ad-supported revenue model is a big question mark. Free music is a very dangerous thing, and we would not like our next generation grow up believing music is for free,” Kalyan said.
Launched 14 years ago and achieving $ 62 million in EBITA in 2012, online survey company SurveyMonkey is a veteran of the SiliconValleystartup scene. With more than 14 million users globally, the company is now keen to boost these numbers even more by upping its presence in Europe. It announced a new London office last week and is now scouting German cities for potential locations.
A European focus isn’t the only thing on the company’s agenda this year: In January it quashed rumors of an upcoming IPO (for now, at least) when it announced a massive $ 800 million in equity and debt financing, with CEODaveGoldberg making it clear that going public is not a priority at the moment.
We caught up with Goldberg while he was in Berlin on a whirlwind business trip to launch SurveyMonkey Enterprise, the company’s new product aimed at businesses, in Germany. He told us why the German market is a top priority, which Berlincompanies have caught his eye and why VCs are “fundamentally lazy.”
To start off with, what are you doing in Berlin?
I’m here because we’re officially launching our SurveyMonkey Enterprise product in Germany. We announced the product in the US a few weeks ago and it’s a pretty big deal for us because it targets businesses and organisations that have multiple staff using the product. It allows teams to collaborate and use SurveyMonkey together – previously users could only have individual accounts – and companies also gain comparison features to help them get the most out of their data.
We’re also here because we plan on eventually having a sales team in Germany. Part of what this trip is about is figuring out where in Germany works for an office.
Is Germany an important market for you?
The thing is, the company is 14 years old and you’ve always been able to create and take a survey in other languages but the site was only in English until about three years ago. Since the site’s been in German, we’ve grown very quickly here. Basically, we’ve been doubling year-on-year. So while Germany is our largest market in the EU, outside of the UK, it’s still a fraction of what it could be. But we are the largest survey company in Germany, there’s lots of competitors — we’ve found about 30 direct ones — but they’re all pretty tiny.
We have a lot of big Germancompanies as customers already – Volkswagen has just signed on for the enterprise product and we have Siemens, SAP, Bosch, Dyson, along with local governments and universities using us. We have almost 200,000 users in Germany.
So you launched the site in different languages only three years ago? Why did this take so long?
A little over four and a half years ago is when I joined and we bought control from the owner. He’d done a great job, it was a great and profitable business but it was still only twelve people and only two of them were engineers. They’d made a product and it worked and scaled, but they didn’t have the resources to do other things, and one of them was languages and currencies. So we had to figure out creative ways to offer new languages, currencies, payment types. Firstly, I had to hire a team and then we had to do the work. But three and a half years ago, when we launched in German, we still only had about 35 people at the company. Now we’re around 280.
That’s very rapid growth. How did you manage the transition from a small team to close to 300 staff?
The goal is to still try and think as much like a startup as possible but also put some processes in place to handle the growth. The best way I’ve figured out to do this is to hire people who understand both sides – so have experience working in a startup and a corporate environment.
You’ve been quite vocal about not going public, announcing $ 800m in debt funding and equity early this year instead. Why choose this route?
The idea was, we’d done pretty well and were wondering how we could get liquidity for some of our investors and employees. The problem wasn’t going public, but being public and having to run the company to hit quarterly financial targets and not being able to make longer term strategic decisions.
We felt if we could get the money and get investors and shareholders to sell their shares for a good price without going public that would be a better choice. So all the money went to investors and employees, it didn’t go into the company – the company is very profitable. We’d only go public if we get some benefit other than liquidity, all of the new investors understand that it may never happen — that was part of the criteria of who we picked.
You were previously at Benchmark as an Entrepreneur in Residence – from your investing background have any Berlin startups caught your eye?
I know SoundCloud very well, I met Alex (Ljung) a couple of months after he started and am really heartened to see what they’ve done, and I know Jimdo too. Through Benchmark, I followed ResearchGate. Those are the ones I know the best. They’re all great companies – great teams that aren’t just building local businesses for Germany, but global companies.
The thing is, it’s very hard to get SiliconValley VCs to fund anything that’s outside of SiliconValley. I mean, it’s hard enough to get them to fund stuff in Chicago, let alone Europe! So people think they don’t want to go to Europe, but the truth is they don’t want to leave their own backyard. Fundamentally, VCs are lazy.
We do occasionally hear of Silicon Valley VCs funding Berlin companies though…
Yes, and it’s a big vote of confidence for those companies — I mean if you can get funded by a SiliconValley VC and you’re not in Silicon Valley, that means you’re really good because they really don’t want to get on a plane. And its so easy for them to fund something that’s local, and so hard for them to fund something that’s not.
One of our investors is Tiger Global and they’ve been very very successful international investors and that’s one of the reasons we brought them in – because we wanted their help to grow internationally.