Open Mountain launches hinventory.com

February 20, 2010

We are pleased to announce the launch of our first product hinventory.com.  hinventory.com allows you to create an inventory of the items in your home online.  The process is as easy as taking photos of the rooms in your house and tagging items in the photos.  Read more about the product at our hinventory.com blog.

When we started Open Mountain a few years back, we recognized there were two lines of business interesting to us.  The first was the startup services business.  Founders, entrepreneurs, and companies uncover new ideas all the time.  They need cost-effective teams managed by experienced leaders to get those ideas to market.  We really like the energy of the startup and the challenge of bringing something new to fruition.

The other line of business was product development.  We’re product people.  We worked at product companies like Adobe, Ariba and Intuit before Open Mountain.  We understand the ins and outs of developing a product and working as part of a team to make that product successful.

The decision for which business to pursue first came down to practicality.  Services businesses generate revenue sooner than product companies.  Longer term, products have a better revenue growth potential, but they require capital or sweat equity to launch.  We looked at the landscape and decided that we prefer to bootstrap our company without taking money and that meant services first and products second.  If you are confronted with this same scenario, I highly suggest you read Guy Kawaski’s Art of the Start.

Fast forward to today, our services business was far more successful than we imagined.  Take a look at our client list and at just some of the companies that launched new products or technologies with us.  Working with startups and creative founders is rewarding.  Nearly all the companies we worked with are still alive and kicking today.

Now it’s time for the product side of the business.  We’re actually launching two products today.  hinventory.com is a Web site for creating a secure home inventory online.  You can read all about it on our hinventory blog.  Please check out the product and become a user.  Use the feedback form to tell us what you think.

The technology behind hinventory.com, called tagiphoto (pronounced tag.ee.photo), is a technology product that enables companies to add photo management and tagging to their integrated Web and mobile offering.  We’re doing a limited launch right now looking for early beta customers if you are interested.

This is a very exciting time for us and we hope you’ll help make our new product successful.  We’re as committed as ever to our services business and continue to sign up new clients each month.  At the end of the day, we’re all about bring new ideas to market whether they are your ideas or ours.

Enjoy!

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Posted by bbenedict

Virtual Corporations are Accepted Practice in the New Economy

September 8, 2009

We were meeting with a new client this week discussing how we cost effectively deliver products and technology.  Low overhead is a key part of our strategy along with near-shore resources for development.  We’re a virtual corporation and that means our work force is distributed.  Office space is limited, and we use other strategies to achieve collaboration and a sense of company.  We explain our strategy in our post on being a green company.

We did not take any initial investment to start the company and that mandates we watch our expenses fastidiously.  In an upcoming post reviewing our predictions for 2009, we think our prediction about back-to-basics business principals has proven true in the new economy. Young companies that thrive in 2009 are often profit drive and bottom line focused.  Open Mountain is no different.

That said, there is a risk staying virtual.  Will customers be more impressed if they walk into a well decorated office with large conference rooms and amazing views of the San Francisco bay?  Or will they understand if we meet using rented conference room space that is nice but not part of our headquarters?  Does this really matter?

The good news is more and more of our customers understand the virtual concept.  Customers are in fact virtual themselves including the new customer we met with and many of our existing customers.  We no longer have to explain that working remote and having a work-space only head quarters does not hinder our ability to deliver.

A virtual company structure is becoming a sign of forward thinking and smart money management.  Companies grow more cost effectively and avoid the risk of expensive leases or even worse having to move.  This approach beckons back to the original Silicon Valley garage start-up and the lore that turned the garage of Bill Hewlett and Dave Packard into a historic land mark.   Spend your money where it matters and preserve your cash until you have money coming in.  As developers, we like working for smart companies as that increases the chance the fruits of our labor will live beyond the challenging launch phase.

I’ve spoken enough in the past about remove collaboration strategies like this post.  I thought I would add some other ideas to help create a sense of company for people who primarily work together yet separate.

Meet periodically face-to-face

We try to meet once a week in a common location.  When we do, we often include lunch, dinner or social activities.  If our near-shore developers come to town, we do our project work in-person as much as possible even if it is not necessary.

Become friends on facebook

Sharing photos, links and comments on facebook is like putting a picture or comic outside your cubicle and having people stop by.  My business partner posts his runs and other actives online and in my mind I hear him telling me I need to exercise.  Sharing life experiences contributes to the sense of company and community.

Use video conferencing

I’ve talked about the benefits of using video in collaboration often enough.  Next time you have a remote Skype session, fire up that Web cam that probably came free with your laptop.

Send weekly status reports

A great way to keep everyone connected is to send and read status reports from everyone in the company.  Reading status reports takes the place of weekly or monthly company meetings and creates a more effective way for employees to feel part of a larger whole.

As you start your company or plan your growth, we highly recommend you consider a virtual strategy.  The cost benefit is significant.  Online tools, status reports and other techniques help you ensure your work force is connected and engaged even if you can not see for yourself.  Interestingly, we are seeing the same evolution with online computing resources.  Companies are saving the cost of building expensive hosting infrastructure by deploying applications on virtual resources in the cloud.  While you are at it, how about considering a virtual development team too!

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Posted by bbenedict

Apple Likely To Overtake Microsoft

April 18, 2009

I am convinced it is just a matter of time before Apple will over take Windows as the dominant operating system on personal computers.  Let’s look at the facts:

- I am doing my taxes on my Mac this year for the first time.  I have years and years of Windows Turbo Tax data files from at least 3 generations of computers.  Having the history helps me get through the experience each year.  Installing Turbo Tax this year, however, has rendered my Windows system useless.  I can only boot safe mode to access my files.  Big thanks to Intuit for giving me the Mac version to complete my taxes.

- We have a family laptop that is stuck with Windows Vista.  The machine is slow and cumbersome.  We constantly lose the wireless connection and are forced to re-boot often to get Blackberry active sync working.  My iPhone works with my iTunes as if they were developed by the same company.

- We use Google docs and other online tools at work for 80% of our document creation.  Graphics work is most of the remaining 20%.  We do this work offline but guess what, Photoshop, Fireworks, and the lot, run equally on Mac and Windows.

- My Windows machine was turned off for a week.  A whole week!  This is a big one.  I use a computer more than anyone I know for many things such as contributing to community sites, writing this blog, and developing software.  A week for me is like a year for everyone else.  Monday morning the other week I turned on my Mac and started working.  By Friday, we were both looking forward to the weekend while my Windows desktop was cold to the touch.  I still can’t believe I never had cause to turn it on.

- My office TV is Windows Media server using the second monitor as the display, but I rarely use it anymore.  All my favorite shows play episodes on the Web after the initial TV run.  NetFlix offers movies online.  I don’t even have to DV-R Heroes.  YouTube and FunnyOrDie are great distractions if I want something new.

- I am totally addicted to Spaces on my Mac.  I have multiple work spaces running all the time that I flip through so quickly people watching me get motion sickness.  There is no chance of getting motion sickness with Windows.

Let me summarize.

The Mac OS is easier to use and more reliable than the Windows.  It’s fast and fun.  The applications I depend on are no longer OS specific.  Rich content is readily available online.  The files I created on Windows over the last 10 years are in my Mac documents folder.  I really don’t need the Window machine much for anything anymore.

All the strangleholds and monopolistic software plays that made Windows what is it today are gone.  For example, MS Office was once required at work.  Now, if it doesn’t come with the machine, people don’t need to buy this expensive software.  I am struggling to find just one example of something I must have Windows for.  The fact is I am several hours into my Monday as of now and I still have not started Windows (to be honest, that’s because the first thing I know I have to do is fix the problem I am ignoring).

Windows continues to go head-to-head with Mac and people are taking a good hard look at the merits of each.  Most of the people I know are going Mac.  The transition happened over the last 5 years to the point where I don’t know anyone raving about the Windows laptop they just bought.  Did I mention I am doing my taxes on my Mac for the first time this year?

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Posted by bbenedict

Important Startup and Technology Trends for 2009

January 19, 2009

As we close out the 2008, we look forward to 2009 and another year of new ideas and great technology. Here are the trends we’ll be watching this year:

Business models – We think because of the current economic client and funding environment companies will be forced to focus on the business side of running a business in 2009. Closing the doors because you run out of cash is not fun for anyone. Investors will expect a real business model from startups and one that doesn’t start with, “Once we have 50,000 users…” We saw this start to happen last year at a facebook meet-up. Several people in the audience wanted to know how the top application developers were going to monetize their success. Short of acquisition, these companies didn’t have an answer. This year, they will need one. How about charging customers who use your software? Surely, if the product is valuable, people can spare $10 a month. Look at the iTunes App Store for an example of how to do this right.

Substantive content – The Internet has truly democratized content. You can post a video, publish a book, write a blog, become an expert, and really put any content you want online as soon as it’s done. But now, we consumers of content spend a lot of time searching for something worth reading let alone finding something we might remember or share. Many people who published perhaps shouldn’t have. Case in point, who better to know what’s funny or not than Will Ferrell versus some guy listing his video under comedy on YouTube? We predict in 2009 consumers of content will focus more on content they can validate or that includes some level of credibility. Sites that have credible subject matter experts or support validation of content should garner more attention in 2009.

facebook is valuable, but social networking is a feature – My non-tech family members are on facebook. The Today Show just did a segment recently about parents invading their kids playground. I even saw some not so flattering pictures of my nephew at his first year in college. facebook may not be worth 15 billion anymore, but we definitely see a new surge of friend requests and many are coming from the least likely of usual suspects. The increased user base will renew the interest in facebook and reverse the declining valuation trend. On the other hand, many other social networking sites are struggling as most companies now include common features like invites, friends, posting, sharing and profiles. We suspect it will be hard for social networking destinations to prove their value in 2009 except for those already well established like LinkedIn for business and facebook for consumers. Look to facebook, and LinkedIn, to grow their dominant position but also for them to introduce new ways to generate revenue for themselves and those around them.

Bootstrapping – As the funding pendulum swings back toward tighter controls and stringent valuations, more and more innovators will resort to the garage startup and working a day job to fund the night job. Founders won’t want to give away ownership, nor invite board members into their decision space, unless the money is good and the cost not so bad. Those caught in this downturn or in the last one in 2001 remember what it means to lose control of your company to investors. Founders will choose to retain ownership as long as possible even if their launch is delayed. We discuss the impacts of various funding models in a previous post.

The New New New Thing – It’s time for new ideas. Calling your company Web 3.0 is not a new idea (notice the version 3 in the name). Tweets. Blogs. Wikis. Community. SaaS. Good stuff that came out of Web 2.0 and before. But people are no longer interested in a new twist on an old idea. The companies that establish a new product category in 2009 will be pleasantly surprised by increased interest from people tired of hearing about yet another way to send a message or post content.

Fast launch – Is the 6 month launch obsolete? Is the 2 month launch simply a bad idea let alone doable? We provide our opinion in this post. The latest trends in development languages and technologies, especially Ruby on Rails and cloud computing, enable faster launch times through quicker process and less over-head. Development teams will be forced to make hard trade-offs this year as they struggle to meet the demands of an evolving market and shrinking development cycle.

Please let us know what you think of our predictions and what you think will be important in 2009.

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Posted by bbenedict

Warren Buffet Principles Apply to Technology

November 22, 2008

Warren Buffet enlightened us to the fact that the stock market is governed by fear and greed. But then he said people should actually be fearful when the market is greedy and greedy when the market is fearful. Similar opposing forces apply to the software industry. Technology is driven by reality and hype. People should look for hype when everyone is based in reality. During a boom, companies should come to reality quickly if they want to survive the bust.

Some very lucky people were at technology startups around 1995. Companies going public prior to 1995 were forced into a strict reality of profitability. The general rule of thumb was several quarters of profits before you IPO. Then Netscape went public in 1995 with no profits and based on the hope, or should I say the hype, of the emerging Web. Look what they started by offering hype above reality. Their success changed the game for what was required by companies to create value in the market.

Imagine what may have happened to you if you believed in hype back then. Development of Hotmail started around 1994 and Microsoft bought it for $400 million in 1997. The product was just email in a browser which is something most developers could create in a weekend with PHP and the mail API. Broadcast.com was started in 1992 as online radio. In 1998, it went IPO and a year later was bought for $5.7 billion. The founders of Netscape, Hotmail and Broadcast.com were looking for the next great thing when most of the industry was stuck in reality.

Then the boom hit.

Everyone came flocking to the Internet and companies were starting all over the place. Idealab!, an Internet incubator, was working on creating a company a month. A company a month! How could that possibly lead to success? It takes years to build a great company. Yet, in 1999, 457 companies went public and a quarter of those doubled in the first day. If you define success by a liquidity event, then clearly success was to be had by many.

One of the most discussed business models was the land grab, a.k.a. the Amazon.com model. Don’t worry about profits or debt, just get as many eyes on your site as possible and stake your claim. Amazon incurred what felt like mountains of debt, and in the end out spent their competitors to success, though I don’t mean to trivialize the other aspects of their impressive execution. While some companies succeeded in this great California gold rush, like eBay and Amazon, many more did not. Why?

The bottom fell out.

In 2001, the stock market took a nose dive and the money dried up. A mere 76 companies went IPO that year. Most of the companies started during the boom went out of business or were gobbled up at bargain basement prices. What happened?

Companies were so focused on the hype and the land grab that they ignored one of the fundamental realities of business. When you don’t have any money, the doors close. Watch the movie Startup.com if you want to see this played out in real life.

Notables like WebVan, eToys, and Beyond.com floundered because they were caught up in the hype and expected the investor community to keep funding them. Had they paid attention to the reality of running a business that must pay expenses and do marketing to get customers, they could have weathered the storm and been the last man standing in a wide open field. Talk about a land grab. When hype implodes, the companies who come to their senses first will have the best chance of surviving.

History is repeating itself right now. The Web 2.0 movement emerged from the dust of the previous fire. The economy rebounded and money started flowing. Look at how many new companies are riding this wave, and as an aside, what’s up with those names???

Facebook is worth billions. MySpace sold for $580 million in 2005. YouTube sold for $1.65 billion in 2006. While many of us were just trying to stay employed, and others were switching back to their former careers, the savvy entrepreneurs remained dedicated to innovation and chance. Being at Google in 1999-2003, forgeddaboutit!

The movement was still hitting stride when some very notable investors in the valley revealed this presentation to the industry earlier this year. OK, to be fair, the economy was already in a funk. But yet again, those companies who were living on hype suddenly found themselves needing to preserve every dollar hoping they can reach cash flow positive before the lights go out. How many of these companies do you think will be around in a year or two?

What does this tell us?

If you believe Warren Buffet, then soon will be the time for hype again as everyone has just been forced back into the reality of trying to get through the crunch. Companies that have identified successful markets or products may run out of cash leaving a door wide open. Investors are preserving cash in case they need it to protect investments they have already made. How long do you think they’ll do that before they start looking for the next MySpace or Facebook?

Even more important, the companies that survive this contraction will be forced to become well-run businesses that effectively manage their bottom line. That in turn makes them attractive to investors provided the hockey stick growth is possible in their market. The money will flow again, that much is sure, if you believe Warren Buffet.

My advice to you is to let the market thin out for a year or so. Spend the time working in a stable job while you enhance your skills and brainstorm ideas. Then, when you have your next idea, a feeling you should definitely validate with all the smart people you trust, get started so that you will have a solid offering when money becomes more available again. That’s what I’ll be doing. I predict by 2010, the seed money will be flowing again. The best founders will not forget the lessons of economic down turn and opposing forces.

If you don’t think there are still great ideas out there, let me say that I still can’t check my voice mail when walking in my front door by just saying “What’s new?” I still don’t know how energy efficient my house is from reading a meter on my wall. I still haven’t worked on the product for my sister that I uncover in this post. And don’t even get me started about how many small businesses are still using desktop software.

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Posted by bbenedict

Good Bye Bill Gates

June 24, 2008

Posts are flying around the blog-o-sphere about a once in a lifetime event. The most successful man in the computer industry is finally stepping down from an active role running Microsoft. That’s right, this week is Bill Gates’ last as an active member of the Microsoft team.

I met Bill a very long time ago. I was extremely lucky to have been a college intern at Microsoft working on Excel 2.0. When I graduated from college, I had two job offers; one from Microsoft in their tools group and the other from Software Publishing Corporation working on Harvard Graphics. If you looked at my LinkedIn Profile, you’ll see that I opted to stay in the bay area.

I went to an intern party at Bill’s house, before his complex had been built. I met many of the founders of MS. I heard Charles Simoni talk that summer about how programmers lose their touch over time. He said when he was younger he could remember every item in every room in a house of 30 rooms.

I even have a button some where that has “Save the blibbet!” on it. The blibbet was the first MS logo (sort of like the AT&T globe) and the button was part of a protest against changing it. At one point, I worked in a fish bowl office of interns with a bird’s eye view of Bill’s office over looking the courtyard.

I have no regrets on my decision to go to SPC. I like more variety in my life and would never have fully bought into the Microsoft way of life.

Sometime later, I ran into Bill Gates a second time at the Intuit merger company meeting. Bill Gates, Scott Cook and Bill Campbell were on the podium. Bill G and Scott were really into the merger. Bill C seemed very hesitant. I, of course, had the (nerve or stupidity, you pick) to ask about how Intuit customers would feel about getting help from MS as a company given that Intuit had built a reputation of being the Mr. Rogers of technical support.

Scott answered with something about how you can’t become a 100 million customer company by being a scum bag. To which I stupidly replied, “I didn’t say he was a scum bag.” The audience roared at this as they thought I had “implied” the scum bag part. I apologized personally to Bill Gates afterwards and he said it was no big deal. Bill Campbell told me it was a great question. And I spent the rest of the party joking that I had become a legend and unemployed at the same time.

I actually have a video of this somewhere in the house, probably next to my save the blibbet button.

What I can tell you is that Bill Gates programmed BASIC on an airplane for the first home made computer, before there were personal computers, Windows and the Internet, and at a time when most of us were impressed with the convenience of calculators. He had vision, acumen and drive that to me, is unparalleled in the computer industry. I respect those qualities and all that he has achieved so far. The man deserves a statue in the front of the computer hall of fame right next to Woz and Jobs and the rest of the early wizards.

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Posted by bbenedict