Satya Murthy

By Eric Ries

I can’t play poker, but I do enjoy watching it on TV. We’re in the middle of the 2009 World Series of Poker, an event that draws thousands of professional and amateur players to Las Vegas every year. The grand finale is the Main Event, a massive Texas Hold ’Em tournament with thousands of players and millions of dollars for the winner.

Tournament poker used to be the province of professionals. But starting a few years ago, a huge wave of amateurs has invaded the game. As a result, of the thousands of entrants into the Main Event, only a few hundred are real pros.

To my surprise, I’ve actually learned a lot about entrepreneurship from watching the World Series of Poker. But it shouldn’t be too surprising. Both rely on acting strategically under conditions of extreme uncertainty. And, in both, small changes in your odds of winning can have a big impact on the final outcome. In fact, I now routinely use the Main Event to help entrepreneurs cope with a frustrating paradox.

Why are some terrible entrepreneurs so successful?

Because the structural barriers to creating a high-tech startup have been lowered dramatically in the past few years, we’re experiencing a huge influx of entrepreneurs. This is a great thing. But it’s meant that there are an awful lot of startup stories floating around. When those stories take on the status of myths, they create tremendous confusion. Naturally, we want to emulate those that have been successful. But that’s not always a good idea.

In the World Series of Poker, no professional has won the Main Event in seven years. When you think about it, this is very surprising. Professional players are so much better than amateurs that they can make a living – in many cases, becoming very very rich – by exploiting the difference between their level of skill and the level of the people they play with. The best of the best win many tournaments each year. By any objective measure, they are much better players than the amateurs. Yet the Main Event has been won year in and year out by a complete unknown player. Some of those amateurs go on to become semi-pro players. But most have never won another tournament after their big win. Why?

The reason is that being a professional player shifts the odds of winning a given poker hand in the professional’s favor, just a little bit. Over the course of a year, a given pro will play thousands of poker hands, and so this shift in probabilities adds up to dramatic winnings. But on any given hand, they still have a significant probability of losing — even if their play is perfect.

Similarly, given enough amateurs in the field, the law of large numbers means that at least some of them will get lucky enough times to outperform even the best pros. That’s why I can say with some certainty that an amateur will win the Main Event this year, even though I have absolutely no idea which of the six thousand entrants it will be.

Entrepreneurship is similar. So much of what makes a startup successful is totally out of our control: the timing of the market, the behavior of competitors, the IPO or M&A window, underlying technology trends and, of course, the human factors of investors, co-founders and employees. Truly successful startup methodologies like customer development or the lean startup can only hope to increase our odds of success — they can’t guarantee it. The converse is also true: even entrepreneurs who do everything wrong sometimes get lucky and make a lot of money anyway. Some even do it repeatedly.

That’s why, for any tactic or strategy — no matter how hare-brained — you can find some “proof” that it works in some company somewhere. That’s what makes processing startup advice so hard. Just because someone has had a success doesn’t necessarily mean they understand why they were successful at all.

Which brings me to the second thing I’ve learned from the WSOP. It’s called a disciplined laydown. In poker, winning requires that your hand beats your opponents hand. The problem is that you don’t know what your opponent has. Amateur players often believe that their success depends on the quality of the cards they are dealt. Consequently, they fold their bad cards and wait for that one big hand to get their chips in with. Unfortunately, having a big hand doesn’t mean you’ll win — your opponent could have an even bigger hand. That’s why the most important skill in poker is not bluffing, counting cards, or computing the odds. It’s figuring out when you need to fold a big, big hand. Watching the pros do this on TV is amazing. Over time, they develop an uncanny instinct for knowing when they are beat, and not throwing more money after bad.

In fact, once you realize that this is the most important skill in poker, it becomes clear that when professional players bet, they are really probing for information. Everything is calculated to help them figure out if their opponent has one of those big hands that might beat them. Folding in those situations saves chips that can be used more profitably later in the tournament.

I think there’s some wisdom here for entrepreneurs, too. We get attached to our big ideas, but it’s those big visions that get us into trouble. Just because we’ve sunk a lot of time and energy into an idea doesn’t necessarily mean it’s a good one. In fact, the main reason we need to get out of the building and validate our ideas is so that we can realize we’re beat before it’s too late and pivot. Once you have that insight, you realize that all of the work we’re doing in building an initial idea — from minimum viable product to split-testing to customer validation — is all designed, like the bets of a poker pro, to promote learning about where we stand.

And that provides another possibility for dealing with startup advice. Instead of making an exhaustive search for all the smartest, most successful people and copying them — learn to place small bets. Take any advice (including mine), and think it through for yourself. Do you understand the underlying principles? Can you see how it applies to your specific context? Can you tease apart the impact of luck? And, once you think you have some advice you might like to follow, try it out. Find a way to pilot it without betting your whole company. And then be prepared to fold if it’s not working. Each time, make sure you do a root cause analysis, and figure out what you learned.

And, if you find advice that seems to work, be ready to go all-in.

Eric Ries is a serial entrepreneur and author of the blog Startup Lessons Learned.

An interesting article by Michael Arrington on Washingtonpost.com

Last weekend I wrote about how the big social gaming companies are making hundreds of millions of dollars in revenue on Facebook and MySpace through games like Farmville and Mobsters. Major media can’t stop applauding the companies long enough to understand what’s really going on with these games. The real story isn’t the business success of these startups. It’s the completely unethical way that they are going about achieving that success.

In short, these games try to get people to pay cash for in game currency so they can level up faster and have a better overall experience. Which is fine. But for users who won’t pay cash, a wide variety of "offers" are available where they can get in-game currency in exchange for lead gen-type offers. Most of these offers are bad for consumers because it confusingly gets them to pay far more for in-game currency than if they just paid cash (there are notable exceptions, but the scammy stuff tends to crowd out the legitimate offers). And it’s also bad for legitimate advertisers.

The reason why I call this an ecosystem is that it’s a self-reinforcing downward cycle. Users are tricked into these lead gen scams. The games get paid, and they plow that money back into Facebook and MySpace in advertising, getting more users. Who are then monetized via lead gen scams. That money is then plowed back into Facebook and MySpace in advertising to get more users¿

Here’s the really insidious part: game developers who monetize the best (and that’s Zynga) make the most money and can spend the most on advertising. Those that won’t touch this stuff (Slide and others) fall further and further behind. Other game developers have to either get in on the monetization or fall behind as well. Companies like Playdom and Playfish seem to be struggling with their conscience and are constantly shifting their policies on lead gen.

The games that scam the most, win.

And some users aren’t dumb, either. For every user who gets tricked into some fake mobile subscription, there’s another who can beat the system. That’s where the legitimate advertisers, like Netflix and Blockbuster, get hit. Users sign up for a free trial with a credit card, get their game currency, then cancel the membership and start over. Netflix has a policy of only paying for a user once. But game developers use a complex set of partner chains to launder these leads and try to get them through for payment. Netflix sees an overall lowering of quality and pays less for leads. Game developers, desperate to monetize, then search for ever more questionable offers to make up the difference. In the end, the decent advertisers are out, and only the worst of the worst remain.

Left alone, the system really will slide into a full blown disaster. The platforms (Facebook and MySpace) are in a position to regulate this, and even have rules prohibiting some scams. But those rules are routinely ignored by developers, and are rarely enforced by Facebook and MySpace.

There can be only one reason Facebook and MySpace turn a blind eye to user protection ¿ they’re getting such a huge cut of revenue back from these developers in advertising. If they turn off the spigot, they hurt themselves.

Zynga may be spending $50 million a year on Facebook advertising alone, fueled partially by lead gen scams. Wonder how Facebook got to profitability way ahead of schedule? It was a surge in this kind of advertising. The money looks clean ¿ it’s from Zynga, Playfish, Playdom and others. But a large portion of it is coming from users who’ve been tricked into one scam or another.

And recent moves by Facebook to shut down application spam only make the problem worse in some way ¿ game developers have to spend more money on advertisers to get users now that the viral channels are shut down. That means the games have to monetize even better. Which means more scams.

It’s time for this to stop. Facebook and MySpace need to create and enforce rules against it so that game developers aren’t tempted to get a competitive edge by scamming users. And if Facebook/MySpace won’t protect users, then the government will have to step in.

There’s an easy way to determine if something is a scam or not. For any particular offer, ask yourself if anyone would buy the product or service if the terms were clearly spelled out for them, and they weren’t being bribed with in-game currency. The answer for many of these is a resounding "no." A few examples are below.

Examples Of Scams:

A typical scam: users are offered in game currency in exchange for filling out an IQ survey. Four simple questions are asked. The answers are irrelevant. When the user gets to the last question they are told their results will be text messaged to them. They are asked to enter in their mobile phone number, and are texted a pin code to enter on the quiz. Once they’ve done that, they’ve just subscribed to a $9.99/month subscription. Tatto Media is the company at the very end of the line on most mobile scams, and they flow it up through Offerpal, SuperRewards and others to the game developers.

As you can see in the image below, nothing in the offer says that the user will be billed $10/month forever for a useless service.

Another scam: Video Professor. Users are offered in game currency if they sign up to receive a free learning CD from Video Professor. The user is told they pay nothing except a $10 shipping charge. But the fine print, on a different page from checkout, tells them they are really getting a whole set of CDs and will be billed $189.95 unless they return them. Most users never return them because they don’t know about the extra charge. Woot. Again, sites like Offerpal and SuperRewards flow these offers through to game developers. See here for more on the Video Professor scam.

Of course, there’s no mention of any of these payments in the offer itself:

An Industry In Denial

Yesterday I attended the Virtual Goods Summit in San Francisco. In the Q&A session of one panel I asked Offerpal CEO Anu Shukla to explain the ethics of her business, and outlined my ecosystem of hell argument above. Shukla went on a tirade, calling my points "shit, doubleshit, and bullshit" (yes, really), but never really addressed the points. A video of the exchange is below, care of Alexa Lee.

Offerpal now has a blog post up on the exchange, but they still don’t address the issues. They offer misdirection, denials and a shield of rules that are never actually enforced.

Sadly, most of the audience of game developers was on Offerpal’s side. Many of these developers see quick dollars with lead gen scams and they don’t really care about how users are affected.

In one session earlier in the day, IGG Cofounder Kevin Xu recommended that game developers "get users in the door to play free, then monetize the hell out of them once they’re hooked." Sadly, it’s simply human nature to push the rules until they break. It’s time for Facebook and MySpace to protect their users from this stuff and make sure it stops.

p.s. ¿ An interesting development. Offerpal defended their mobile survey scams on stage and in the blog post referenced above, saying there was no scam involved. But today those offers have quietly been pulled down from all the games I’ve checked. If there’s no scam, why remove them? At least some good is coming from my ongoing rants.

Update: Two Companies That Said No To Social Media Scams

from: inspiredm.com

Let’s not forget that the Web 2.0 hype was not just about glossy logos and round cornered buttons; the added value of this new wave of websites is the social part and the huge potential to ‘make things together’. So here’s a roundup of the most popular and interesting services that offer us the opportunity to find or submit designs or ideas.

Kickstarter

Kickstarter is a funding platform for artists, designers, filmmakers, musicians, journalists, inventors, explorers…

Crowdspring

By helping Buyers reach countless creatives across the globe, we’re changing the game for the little guy.

99 Designs

Need something designed? 99designs connects clients needing design work such as logo designs, business cards or web sites to a thriving community of39,698 talented designers.

Brandstack

A Spring is our voting system. When someone likes your portfolio or your uploads they can Spring it. Items that receive more Springs will receive more exposure.

Social Designer

Buy stuff, design stuff, vote on stuff and be an agent of change.

Name This

Namethis makes the otherwise time-consuming process of finding a market-ready name quick and painless.

BigCarrot

The site allows people with a common interest to come together and pool their contributions to create an inducement prize.

Collab Finder

The Place To Find Designer & Developer Collaborators.

Collab.ie

Enabling collaboration by helping people with ideas meet people with skills.

Pikkoo

The first social community for user generated interactive mobile screensavers & wallpapers.

Genius Rocket

Advertising and marketing projects for a tenth the cost of traditional ad agencies.

For all those hungry entrepreneurs/CEOs of startups…

• If you cant look at other entrepreneurs and learn – then don’t look at them. Jealousy (or self pity) will kill you in this business!
• When you look at facebook and twitter, your imagination must run wild… you heart might say, I wish I could come up with an idea like that. Well here is the truth – don’t try and create something for the entire world – break it down. Remember the British – divide and conquer!
• Companies like facebook were never created for the world – they tried to address a small, specific need – and it just happened to become big. And – NO – it didn’t happen overnight!
• I see most entrepreneurs trying to sell the product before its fully functional or useful! Give it some time – its good to talk about it – but pls for gods sake don’t spam the networking sites, your friends and families mail boxes.
• Don’t copy – After the success of FB and twitter, there came some 100 scripts which can the do the same – what’s the point? Its good to have a niche social networking site about cats or fashion or women in games or what not – but thinking that you can replicate the success of twitter and FB or MySpace is madness – you will end up like orkut – neither dead or alive!
• Don’t burn yourself – if you are making a decent salary and working for someone –great – keep doing that until you really really have to quit! thinking that you can survive on the revenue from adsense is crazy talk!
• Say yes to venture capitalists – money in all forms is good – if a VC is ready to fund you, I’d say take it! Don’t listen to people telling you about “how VCs will take the control away” that’s nonsense! Having that extra $ or Rupee in your pocket will only help you be a little bolder and experiment with you company/product. Remember, you want to stay alive in today’s business – keep reinventing your products/ideas.
• Lastly – marry as many people as you can in your business, its good to have people who believe in you and can advise you in crappy times. You will need more than a couple of shoulders to cry on if you are an entrepreneur – that’s how this game is!

Don’t take on the world all at once, take once city/district/state/country at a time! My 2 cents!

from: Washington post By Mike Musgrove

A modestly sized office tucked in the leafy northern corner of Baltimore might seem an unlikely perch from which to crack into the big-bucks video-game industry, but that’s what Kalypso Media USA is setting out to do. Having opened its doors in June, the firm just launched its first title, a strategy game called Tropico 3.

For Deborah Tillett, a local game industry veteran, it’s partly a matter of practicing what she preaches. When not running the U.S. branch of Kalypso, she teaches a class in entrepreneurship at Towson University. There’s one point that she repeats to her students on a regular basis: During an economic downturn like this, there’s no place to go but up.

"This is the best time in the world to start something," says Tillett, the president of the German company’s new U.S. outpost. "You can’t get worse than zero."

As it happens, that’s also a premise that happens to match up with some of the action in the company’s new game, set in a fictional Caribbean island called "Tropico." In the title, released this month, players take on the role of a dictator guiding the tiny island’s limited resources and try to guide it to success, through the skillful management of business and social policies.

"El Presidente," the island’s ruler, can be benign or despotic according to a player’s whim. Players can decide whether to build factories or schools; farms can raise either food or profit-producing tobacco crops. The game’s ultimate goal is to build a country that is both profitable and filled with citizens who are well-fed and content.

It’s not very often, these days, that a new company tries to crack into the business of publishing video games. Talk to game developers and publishers and they typically relate the same headaches: Software development costs are through the roof, marketing costs are growing — and getting shelf space on retail stores is a constant struggle.

As a result of such factors, there’s been a major consolidation in the video-game industry over the years, with deep-pocketed publishers buying up smaller studios. What’s more, as part of that trend, big publishers are typically producing fewer games in the hopes of making stellar profits off the breakout hits that sell millions.

Start-ups like Kalypso, however, hope that running against the grain gives them an advantage. Tillett cites the success of an independent company called Her Interactive, which found its fortune by making games based off of the Nancy Drew series of mysteries.

Her Interactive was launched at a time, a little over a decade ago, when publishers were convinced that games aimed at girls wouldn’t sell, so the game studio offered its first title for sale on Amazon.com. Since that time, the company has sold 7 million copies of its Nancy Drew games, which regularly break onto the industry’s bestseller lists.

"Oftentimes it’s the smaller companies that take the risks," Megan Gaiser, the company’s founder, who grew up in Bethesda and turned to the games industry after a career as an editor and producer of documentary films. "The bigger companies are going to stick with what works."

As the name would imply, Kalypso’s Tropico 3 is itself the third instalment of a series, but the firm did not make or publish the game’s previous versions. Take-Two Interactive, a company famous for the very lucrative Grand Theft Auto games, sold Kalypso the rights.

Take-Two is a huge company that wouldn’t be able to make enough profit for a new Tropico game to be worthwhile, Tillett said. Previous versions of Tropico sold hundreds of thousands of copies; while that’s a respectable following by many measurements, it’s a pittance compared with many millions of unit sales for every new "GTA" game.

Basically, it’s just another lesson that could be taken from one of her business classes. "Bigger companies can’t afford to do what we’re doing and thus are missing part of the market," she said.

Kalypso intends to put out about 10 game products a year, said Simon Hellwig, one of the German founders of Kalypso. Many of those will be games designed by independent studios in Europe that couldn’t otherwise get distribution on the shelves of retail stores in the United States. Tropico 3 was developed by a software team in Bulgaria, under contract with Kalypso.

Hellwig admitted that the company had originally looked in places such as the West Coast when looking to open up shop in this country, but it ultimately decided to give Tillett the job, based on her experience with Baltimore-area companies such as Breakaway Games, a firm best-known for making simulation software used for training military personnel and emergency responders. "To us, it’s more or less equal where the office is, if we have the right people."

As for Tropico 3, the early reviews have been generally positive. At Metacritic.com, a Web site that aggregates reviews written on sites across the Web and distills each down to a number score, the game has gotten an average review of 83 out of 100.

Priced at $40, or a little bit less than the $60 price tag attached to most new games, the title went on sale last week and is available online and in game and electronics stores. Although the game has only been on sale a few days, it is already — by one recent check — at the number-two spot at Amazon.com, in the category of PC strategy games.

An excellent article by Maya on her Blog – “Money is on my mind a lot these days. It is the first time in years that I am not bringing a pay check home. We are paying our bills, thanks to my husband having a job, but I never imagined I’d ever go this long without contributing to the family income (or cash-flow) …” Read more here – Are you rich but unhappy? Or poor and happy Or something else?

An excellent article by Sarah Lacy on business week the prime suspects responsible for the Valley’s nagging aversion to risk. Here is an excerpt

“I was recently at a Silicon Valley conference where one of the debates that raged into the wee hours centered on Silicon Valley’s increasing aversion to risk: Is it a good thing, and who’s to blame for it?

Less risk-taking by entrepreneurs means less outright failure. A lot of burned startup founders and investors see this as a plus. But any macroeconomist will tell you it’s the rare home runs—successful, innovative companies yielding high returns—that create jobs and capital that keep the Valley humming.”

Read more here – Business Week

By Chris Bowler on appstorm.net

When you make the decision to go out on your own, you are faced with many choices. Should you work from home or rent a space? Bill hourly or by the job? What kind of hours should you assign as ‘work time’?

Amidst all those decisions that have to be made, you also have to choose what tools you’re going to use to actually do your job. And the web is both a blessing and a curse in this regard. It’s a blessing in that it gives you a plethora of choices for the different categories of applications. But it can be a curse because there are so many good options to choose from.

What’s a poor, green-behind-the-ears freelancer to do? Well, you can start by letting us whittle down the list a little for you. Separate some of the wheat from the chaff, so to speak. You’ll still have find which of the tools below best fit your needs and style, but this is the right place to start.

We’ve broken down the apps into larger categories, highlighted the best or most interesting in each category, and included the best of the rest. Click away — each image will take you to the app listed. Enjoy!

Invoicing and Time Tracking

First things first — you need to get paid. And so you need to bill your customers. And if you bill by the hour, you need to track your time. Whether it’s sending professional looking invoices or easily tracking your hours, these apps are the best available and a pleasure to use.

the Invoice Machine

A beautifully designed application that focuses on simplicity, the Invoice Machine is one of the nicer invoicing tools available. A professional looking invoice says a lot to your client — Invoice Machine can help complete a great impression.

Ballpark

The better way to send invoices.

Harvest

Sleek, intuitive, fast.

FreshBooks

Track your time and send invoices.

LessTimeSpent

A simple time tracking solution.

Blinksale

A focus on ease of use.

Tempo

Simple time tracking, powerful reporting.

Financial/Accounting

Once you start getting paid, you have to do something with the money. Taking care of the finances — bookkeeping, accounting, taxes included — is probably one of the least enjoyed aspects of working for yourself. But it has to be done, so you’re best off finding a tool that makes these tasks easy and efficient.

Mint

One of the more refreshing apps to come along recently, Mint was changing the way people were able to manage their finances. With their recent sale to Intuit — makers of Quicken — there has been a bit of a backlash and a lot of people deleting their accounts.

Regardless, Mint is still one of the nicest tools to keep on top of your finances.

Wesabe

Your money. Your community.

LessAccounting

Accounting made simple.

Geezeo

Make sense of your money.

e-conomic

Online accounting for novices.

Pulse

Monitor the heartbeat of your business.

Project/Task Management

Once you’ve gotten the business side of things out of the way, you need to manage the actual work. Projects, recurring tasks, and sharing tasks are all part of the life of a freelancer. Whether you’re looking for a full fledged project management tool or a simple way to track your own work, there are many tools available.

Use any of these top applications to stay on top of what you do.

Basecamp

Despite a lot of other sites copying their style, 37signals still lead the way in the project management space. Basecamp is simply the best application to manage your work. With a focus on simplicity and communication, it’s an enjoyable tool to use.

Ad with so many other web based applications integrating with Basecamp, it doesn’t appear that it’ll be knocked off its perch anytime soon.

Staction

Stop managing projects, start managing people.

Remember the Milk

The best way to manage your tasks.

Subernova

Project management for rockstars.

task.fm

Outsource your memory.

Action Method Online

Too many ideas. Not enough action.

Huddle

Work better together.

Comindwork

Manage projects online.

Remindr

Dead simple reminders.

TaskBin

Managing tasks for groups.

FIle Management

After you spend the time figuring out what needs to get done — and start doing — the result will in many cases involve files to manage or share. Some of the project management tools above include file management and online storage. But many do not.

Not to worry though. There are lots of options for storing, sharing and backing up your data. Here’s some tools focused on this essential aspect of your business.

Dropbox

I’ve talked here recently about Dropbox and I have to confess — this is one of my favourite tools. It has been a great boon to my business and makes collaboration a cinch. Add the peace of mind with its file revisions and tight integration with the operating system and it simply fades into the background.

Actually, for a web tool, it feels like a part of your operating system. This still amazes me.

drop.io

Simple real-time sharing and collaborating.

UploadRobots

Upload, share and download files.

FileGears

File collaboration made easy.

Google Docs

File sharing from your Internet overlords.

KnowledgeTree

Connect your global workforce.

Fluxiom

Online media management.

CRM

One other vital aspect to your business is keeping track of customers. Tracking interactions, leads, tasks, meetings and follow-up’s is needed to make sure that your revenue streams are always flowing.

Gist

Still in beta, Gist is still working out the kinks. But for those who like to get the big picture, this is a tool with a lot of promise. How does it work? It takes your interactions with others from Twitter, Facebook, your email and others and analyzes who you talk to. It then tracks the online activity of those people and ranks the updates based on their importance to you.

This is a simplified overview — sign up to check it out for yourself. It’s probably not for everyone, but it is an interesting way for busy freelancers to stay on top of the people they depend on.

Highrise

Track your leads, contacts and deals.

SugarCRM

The cloud is open.

SixCentral

Easily manage your proposals.

Salesforce

The right answer for right now.

Social Tools

Anyone who has spent some time as a remote web worker knows that paying attention to your social life is important. When you don’t go to an office and interact face to face with other adults every day, you are exposed to the dangers of isolation.

Now, the tools below are not going to replace the physical interaction we all require, but they can help fill in for the banter that you’d participate in at a more traditional workspace. Whether keeping in touch with coworkers and partners or general internet friends, the apps listed here can help you feel in touch with the outside world.

Twitter

When Twitter first came on the scene, there sure seemed to be a lot of people saying they ‘didn’t get it’ or that it was a waste of time. A couple of years later and it seems that those people aren’t around anymore. Or they’re keeping quiet. Or they’re busy tweeting.

Twitter is the de facto standard for communicating online now.

life.io

Your life, your way.

Facebook

Connect and share with your people.

Campfire

Team collaboration with real time chat.

Coop

Stay in tune with your co-workers.

Phone

Many web workers dislike using the phone, but there are going to be those times when email or IM just don’t cut it. Make sure you give your customers and/or teammates another avenue of getting your time and attention.

The following tools are aimed at mobility with flexibility.

Skype

People all over the world use Skype as their primary means of communicating. With instant messaging and voice services, including voicemail, huge long distance charges seem like a thing of the past century.

If the controversy and ownership of Skype’s technology ends well, this service will continue to be a mainstay in online business.

Jott

Three ways to make your mobile life easier.

Google Voice

One number to rule them all.

RingCentral

Your phone system, everywhere.

Resume/Portfolio

From many freelancers, in order to keep the work coming in, you need to be able to show potential customers who you are and what you’ve done. There are many web applications that now focus on this genre.

Here are two of our favourites.

Raveal

A newer entrant in this category, Raveal shows a lot of promise. It’s intended to mix both your portfolio and resume into one entity. It’s an interesting approach.

CeeVee

The smarter way to create and share your resume.

Miscellaneous Tools

Lastly, here are a few other tools that are somewhat in a category of their own, but may help you in running a successful business.

cotweet

If you are going to interact with your clients via Twitter, than cotweet is a service that may be of interest. It makes managing a business account a little easier with support for dual accounts, assignment of tweets, and robust notifications.

Screenr

Instant screencasts for Twitter.

Moobiz

Easy online small business software.

timebridge

Run great meetings.

That’s All for Now

There are plenty of other great web tools that could have been included here. Freelancers in this day and age certainly have no shortage of choices.

Take some time to consider your needs and then choose the tools that work for you.

from: http://www.pehub.com/52616/angel-investors-to-startups-yes-we-charge/ 

Jason Calacanis’s blog post Friday attacking angel investor groups who charge entrepreneurs to pitch their start-ups continues to generate Tweets, comments and blog posts, many from outraged entrepreneurs.

VC Fred Wilson of Union Square Ventures also weighed in for Jason, warning entrepreneurs to avoid not only angel groups that charge but also “start-up agents that charge entrepreneurs upfront cash to make intros to potential investors…A basic rule of thumb for fundraising agents is that they must work on a success fee basis or you should not use them.”

However, representatives from two more of the groups Calacanis attacked by name — Maverick Angels and the Keiretsu Forum — called over the weekend to defend their practices.

They said some entrepreneurs have “a sense of entitlement” and believe that whatever they do is worth a hearing. (Entrepreneurs have to believe in what they’re doing or they’ll fail, but “sense of entitlement” is a phrase used by every angel group I’ve talked to). One of these groups also claims that Calacanis’s TechCrunch50 conference makes a lot more money off start-ups than they do.

Any entrepreneur can apply for a hearing to Maverick Angels or Keiretsu Forum, they said, and those who are chosen to move forward get weeks of free coaching and mentorship on their pitches before they’re asked to pay. Also, entrepreneurs don’t have to pay — they can drop out if they want.

Maverick Angels seems to have more steps in their process than Keiretsu and their fees are staged accordingly. Maverick founder John Dilts, who used to be associated with Keiretsu, said there’s a lot wrong with angel investing — the process is still too random, he said, and the angels have to be controlled as well as the entrepreneurs. At Maverick meetings, for example, angels are not allowed to make long, off-the-point speeches.

The Keiretsu Forum, meanwhile, said that while TechCrunch50 charges all but the entrepreneur to attend, associates of the entrepreneurs chosen by Keiretsu can participate in their process for free. “We are not in this to make money,” a spokesman said.

Jason Calacanis hasn’t gotten back to me on this one, but if he does I’ll add his comment.

Dave Troy here with Kris Appel, our guest blogger for today. Kris is the founder of Encore Path, a medical technology start-up in Baltimore.

As a first-time entrepreneur, raising the money to launch launch a medical device was a significant undertaking.

I am not only a first-time entrepreneur, but I chose to start a company in an unfamiliar field. I have a background in linguistics, but my company develops medical technology for stroke rehabilitation.

So I started this endeavor with two strikes against me. This month, I will close my Series A round, and my first product was launched this summer, a rehabilitation device that improves arm function in survivors of stroke and other brain injury. Here is how I was able to attract investment:

• Humility — Everyone knows something I don’t. Why wouldn’t I want to learn from them? I am thankful that people care enough about me to offer their advice and give me their time. I’m sure they have other things to do, but they’ve chosen to spend this part of their day with me, and I’m going to listen to what they have to say.

• Be nice to everyone, all the time — I’ve met people everywhere who might turn out to be investors or important advisors. You never know when someone is going to help you, it could be weeks or even YEARS away, but you want them to remember you fondly, and to want to help you succeed.

• Meet with everyone who asks — Especially early on, I met with everyone who requested a meeting with me. And I didn’t mind asking each person for something — a referral, a market report, scientific data I couldn’t afford to buy, business advice. Some of those casual meetings turned into major investments later.

• Enter business plan competitions — I entered, and won, a few business plan competitions. In addition to winning cash for my business, I made a lot of contacts, got some very positive press, and got a TON of free advice about my business plan.

• Let people get to know you — All of my investors were strangers to me when I started this company. But I sought them out in the beginning as advisors, and spent time with them over months and years, talking about progress I’ve made and where I’m headed. It helped to build trust and credibility, and they eventually invested.

• Be patient — Every single aspect of this business has taken a lot longer than I thought it would. But so far everything has happened exactly as expected, just at a different time.

• Surround yourself with supportive people — This is the hardest thing I’ve ever tried to do. I needed all the courage I could muster, and support from friends and family. I dropped friends who couldn’t support me, and found new ones who understood. It made a difference.

• Keep your business plan current — This seems obvious but it’s harder than you think. Almost every month STILL I take time to update my business plan. You never know when you’ll need to email it to someone, or enter it into a business plan competition, or use parts of it for a grant or loan application.

From http://onstartups.com/tabid/3339/bid/10216/Burning-Cash-Is-For-Toasting-Marshmallows-cartoon.aspx

I’m going to go on a bit of a rant here.

I’m miffed that the industry term for the process whereby  startups invest in building their businesses is called “burning cash”.  If your startup is burning cash (as shown in the cartoon above), you’re doing it wrong.  You should’t be burning money, you should be investing money — with the goal of growing your business.

I find it interesting that when venture capitalists (VCs) take money from their limited partners (LPs), they don’t say:  Hey, we’re going to take your money and go burn it on a bunch of different startups.  Why?  Because that’s not what they do (not the good ones anyways).  What they do is invest the cash in the hopes of generating a good return.

So, I’m going to ask that all startups that have raised funding to no longer use the term “burn rate”.  Instead, lets call it what it is (or should be):  An investment rate. As in "our startup has an investment rate of about $400k/month".

Oh, and if you really are burning cash, please start using smaller bills.

From: – Dean Takahashi on Venture Beat

IMVU has been fairly quiet about its success in virtual chat rooms, where people can create their own dressed-up 3-D characters and socialize in graphically beautiful settings. But today it’s starting to trumpet loudly that it has established a strong business with a $25 million annual revenue run rate.

Cary Rosenzweig, chief executive and president of the Palo Alto, Calif.-based company, said in an interview the company has doubled its revenue in the past year in spite of the recession and the cooling off of the virtual world hype. IMVU now has more than 40 million registered users and six million unique visitors a month, according to comScore. For the past three months, the company has been profitable, Rosenzweig said.

If the company keeps up its momentum, it will have a shot at generating the kind of highly profitable larger business that publicly traded chat/virtual world companies in China have seen. Rosenzweig says he admires companies such as China’s Changyou and hopes to duplicate their success. He’s speaking up about the success now because IMVU hopes to land partners that can drive more traffic to the site.

“I think it’s important that potential partners know which companies in this space are going to be around tomorrow,” Rosenzweig said.

IMVU grew its revenue primarily by increasing the sale of virtual currency to its members, who use that currency to purchase virtual goods ranging from clothing for their avatars to furniture for their rooms. Since 2004, IMVU’s own users have created more than 3 million items, giving IMVU the biggest catalog of virtual goods in the world.

[EMBED1]Users can create their own avatars for free, but IMVU got a big boost this summer after it launched a new user interface. That interface allows users to try clothes on their avatars using a “try it” button. They can then purchase the clothing with virtual currency by clicking on a “buy it” button. With the new interface, more users are clicking on “buy it.” In the past 30 days, more than 35,000 user-developers have sold virtual goods. Those users are adding more than 4,000 customized 3-D items for sale each day.

Rosenzweig said the business model is dependent mostly on the sale of virtual currency. Users buy credits from IMVU and then use those credits to buy items from each other. Developers can get training on 3-D artistry and within a very short time upload their creations for no charge. They keep 100 percent of the proceeds of the credits. If developers want to cash out, they can do so through an in-game market that allows them to sell credits directly to users. IMVU takes a small processing fee when that happens. Hence, the more trading that happens, the more IMVU makes.

“We’re kind of like an eBay for virtual goods,” Rosenzweig said.

IMVU also recently started inserting advertisements into the site and spending some of its profits on online marketing. It accommodates younger users (who don’t have credit cards) with the sale of prepaid cards in 24,000 outlets, and it also lets users buy credits by filling out surveys or special offers from Offerpal.

With all of these changes, revenue has grown from roughly $2.5 million in the first quarter of 2008 to an expected $6 million-plus in the third quarter of 2009. Revenue has been growing each month for the last 13 months, even with the downturn. Monthly revenue is now above $2 million.

Users engage in 770,000 chat sessions per day, with the average chat session lasting 60 minutes. That represents a level of engagement that is enviable among entertainment sites. Some folks like to joke that it’s all sex chat, since there are a lot of racy avatars in IMVU. But Rosenzweig says it’s not a predominant part of the experience. Porn isn’t allowed and the audience is predominantly female.

Despite its large growth, the company has been able to keep its costs low. One reason is the way it is designed. Companies such as Linden Lab, which runs virtual world Second Life, have enormous server costs because they have to maintain a physically interconnected virtual world 24 hours a day. But IMVU’s virtual spaces are limited to rooms or scenes (like the beach or an estate), and its content is user-generated. That means that IMVU doesn’t have to buy or lease a lot of new servers or hire a lot of artists as it adds more users or catalog items. By contrast, a virtual world owner (without user-generated content and with a continuous virtual world) would have to add a lot of fixed costs as it expands.

IMVU has 59 employees and has raised $30 million in three rounds of venture funding to date. Most recently it raised $10 million in January from Best Buy Capital, Menlo Ventures, Allegis Capital, and Bridgescale Partners.

Rivals include Facebook and MySpace on the social networking level. In virtual worlds/virtual chat, its rivals include Meez and Gaia Online. The fashion-based game being developed by Nurien Software is also a likely competitor, when Nurien launches its highly realistic fashion game world in 2010.

Both of the latter appeal to younger teens. But 58 percent of IMVU’s users are 18 or older. About 69 percent are female, largely because of the fashion-oriented nature of the site. About 62 percent are in the U.S.

Rosenzweig said there are plenty of avenues for expansion in the future. That includes expansion into non-English speaking geographies. The company could also move into mobile platforms and the Mac.