Archive for the ‘Startup’ Category

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Hardware is so hot right now. So hot, in fact, that
another European hardware startup is formulating an
attack on the smartphone hardware space — joining
the likes of Finland’s Jolla and Spain’s Geeksphone
to have a go at handset making. The newest comer
stepping in with a plan to shake up the “status quo” is called Kazam: a startup co-founded by a pair of
former U.K. HTC execs, Michael Coombes and
James Atkins. Coombes, who spent just over a year and a half as a
U.K. head of sales for HTC, according to his
LinkedIn, is Kazam’s CEO. Prior to HTC he
apparently worked for mobile and telecoms
companies including Nokia and Vodafone. While
Atkins, Kazam’s CMO, spent just over a year as HTC’s head of marketing for U.K./Ireland, and has
previously worked in U.K. marketing roles for freesat,
LG and Panasonic. The pair’s professional network is
clearly tied tightly to the local market, hence,
presumably, Kazam’s focus on Europe first. “Kazam will focus on Europe at the outset,”
“We are currently
establishing a network of regional sales and
marketing offices to ensure we deliver outstanding
products and customer service.” The startup has a U.K. base in Mayfair, London. Details of how exactly Kazam plans to assault the
Samsung and Apple smartphone duopoly were not
forthcoming when I asked. Atkins declined to answer
the bulk of my questions — including such specifics
as whether Kazam’s planned smartphones will run
Android and be skinned with a custom UI or keep the experience familiarly stock. Instead, he trotted out a
repeated PR mantra: “Today we are just announcing
that the Kazam brand is here, for the rest you will
have to wait and see.” It’s notable that this startup has already engaged a
PR company (Noire) — and talks about creating a
mobile brand — even before having a great deal to talk about. Which does serve to underline how
smartphones have become a game of who can shout
the loudest. A game of brash tones (as I have
previously described it). What did Atkins say? Not a whole lot. He declined to
reveal how much funding Kazam is backed by at this
point, or whether it is currently looking to raise a
round. He did at least confirm it has backers, and that
those backers have links into Asian mobile
manufacturing companies — which suggests it’s following Jolla’s manufacturing playbook. “Kazam Mobile has been set up by a group of private
equity investors, who have previously launched and
operated successful mobile telecommunications
companies and technology businesses. Some of their
current investments include NF Technology Limited,
an R&D company specialising in developing and customising mobile phone devices and tablets and
Nichefinder (S’pore) PTE Limited, a proven
technology procurement and supply company,”
He also confirmed Kazam’s plan is to launch “a range
of smartphones at different prices point/specs” later
this year. Asked whether it will look at other types of
mobile devices, such as tablets, he said only that its
initial focus is on smartphones. He added that he and
Coombes left their roles at HTC earlier this year “with the desire to build a new brand that really stands out
in the mobile space”. He also declined to be drawn on the differentiation
question but in Kazam’s inaugural press release
today Coombes said: “We believe your smartphone is
a digital reflection of who you are, and since we are
all different, it’s important that we don’t adopt a one
size fits all approach. Kazam’s dynamic structure and focus on local markets means we can react quickly to
the ever evolving and diverging needs of today’s
consumer. We aim to provide quality smartphones
that are accessible to everyone.” The release also includes a statement from Atkins
hinting that aftersales service might be how Kazam
attempts to stand out in a crowded market: “There is
a real opportunity for a new mobile brand to disrupt
the status quo. We are passionate about delivering a
truly positive mobile experience that doesn’t just stop once you’ve bought the phone. Kazam is about
stunning design, robust hardware and intuitive
technology, underpinned by outstanding customer
service.” Further details about exactly what kind of customer
service opportunity Kazam reckons it has identified
were not forthcoming. The size of Kazam’s team at this point is just Atkins
and Coombes — a few more if you count the hired
help from their external PR company. But Atkins also
said the startup has already “established an R&D
centre”. Hopefully with some staff in it, but
presumably no permanent headcount yet. Should Kazam get off the ground with its grand status
quo shaking plan it will need to significantly boost its
body count — if only to staff the network of regional
sales and marketing offices it is currently
establishing. It will also need to make decent
smartphone hardware — hardware that’s worth shouting about. Whether it will be able to deliver that
is clearly something to file under “wait and see”. Asked how a startup with inevitably bounded
resources can succeed in such a fiercely competitive
space — when veteran players such as HTC are
having such a tough time standing out despite making
cracking handsets like the HTC One — Atkins’ said
only: “The mobile market whilst competitive, seems to have stagnated.” Stagnation is one word for it. Saturation is another.
Smartphone hardware and software has achieved a
very high quality bar, with Android OEMs like
Samsung pushing high-end features lower and lower
down the price-point range to pull up the capabilities
of mid- and even budget handsets. This has resulted in a surfeit of great phones, across a very broad
spectrum of price-points. Which means precious little
room for anyone new to elbow in. Or stand out. So there are huge question marks over any startup
entering such a fiercely competitive space, especially
with so many better resourced former mobile giants
continuing to struggle. Disruption often starts small
but in a market so beholden to carriers, where the
bulk of phones sales occur, it’s especially hard for an upstart to get traction. Carriers tend to be risk averse
and have established distribution partnerships and
(incentivised) relationships with the smartphone
giants so have disincentives to push anything too
new. Going it alone with online retail distribution is the
alternative, but that route requires a sizeable marketing budget to even get noticed. Creating handsets for an underserved niche may be
one way to carve out a business, as Geeksphone has
been. Securing carrier distribution agreements to
carry your hardware is another strategy, as Jolla has
with Finland’s DNA. For now, it’s unclear whether
Kazam has any similar moves up its sleeve, but it will certainly be hoping it has enough local telco
connections — and financial backing — to give it a
regional chance of inching in. To say it has its work
cut out to make any kind of impact is an
understatement.

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Irish startup Galvanic has just launched a Kickstarter
to crowdsource funding a wireless stress biosensor
it’s calling PIP. PIP — which stands for ‘personal
input pod’ — is a Bluetooth biosensor that monitors
its user’s stress levels by measuring their galvanic
skin response (GSR) as they hold the PIP pinched between thumb and forefinger. GSR means skin
conductance — so basically how sweaty you’re
getting and therefore how nervous you’re feeling. PIP isn’t just a quantifiable self-tapping biosensor; it’s
been designed to work in conjunction with iOS and
Android phone and tablet apps to provide a
gamification element. The company has created three
games designed to be played using the PIP, which
utilises Bluetooth as its data transport tech. The user’s stress level is then incorporated into each
game as the core gameplay mechanic — with the
ultimate aim being to help the player learn what they
need to do to relax. It sounds a bit counterintuitive, since competitive
gaming can be synonymous with sweaty palms,
which is presumably why Galvanic’s project extends
to designing stress-busting games. It’s created three
games to be used in conjunction with the PIP — a
relaxing racing game, a seasonal mood game where players meditate on a wintery scene to turn it into
spring, and a more playful lie-detector multi-player
game — but it does also plan to launch an SDK in
future to get third party developers expanding the
PIP’s gaming ecosystem. With this initial handful of in-house games the PIP
can only be so interesting, but if Galvanic can
convince enough people to buy in to the gadget and
thus lure enough outside developers to join in, there’s
plenty of potential for other cool biosensing software
ideas. The price per PIP is $79 for a limited number of early bird Kickstarter backers, or $99 thereafter.
Presumably each new PIP-compatible game may
also carry a consumer price-tag. Galvanic is gunning for $100,000 in Kickstarter
funding, with the money to be used for finalising
manufacturing and readying its own apps. Assuming
it hits this rather ambitious funding goal, the company
reckons it can gear up for mass production by the end
of 2013, and expects to be shipping in Q1 2014. In future it said it plans to expand platform support
beyond Android and iOS, to add Windows Phone,
Blackberry, Windows, MacOS and also game
Consoles and set-top boxes.

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As we continue to see more details brought to light in
how the government requests and uses information
about what we do on the web and on our mobile
devices, an ex-Googler and a consumer rights
attorney who have dedicated themselves to helping
users remain private have raised some funding to do this better and in more places. Disconnect, the startup behind the Disconnect.me
extensions for Chrome, Firefox and Safari browsers,
which lets users of Facebook, Google and Twitter
keep themselves from being tracked by third party
sites, and the Disconnect 2 app that covers some
has raised a $3.5 million Series A round. At the same time, as a measure of dedication to its
principle of being positioned not for profit but for
social good, Disconnect has been designated as a B
Corporation, a semi-charitable certification. With the
tax breaks and other help that this offers, it will let
Disconnect dedicate time to raising awareness and campaigning as well as to creating for-profit products. “As a B Corporation, we’re able to spend more time
than a traditional company on activities such as
consumer education, petition drives, and close
collaboration with non-profits,” Gus Warren, a former
Venture Partner at FirstMark Capital who is part of
Disconnect’s executive team, noted in a statement. “Disconnect is committed to benefiting not just
shareholders but all stakeholders, including the
public.” Warren will run the company’s New York
office. This most recent round of funding was led by
FirstMark Capital, and comes on the back of a
$600,000 seed round announced in March 2012. That
round was led by Highland Capital Partners with
participation from Charles River Ventures, and angels
including David Cancel, Mark Jacobstein, Ramesh Haridas, Vikas Taneja, Chris Hobbs, and Andy
Toebben. Founders Brian Kennish, formerly an engineer at
Google who left to work on this full-time, and Casey
Oppenheim, a consumer rights attorney, say the
startup will be using the funding first of all to help with
the launch of Disconnect 2 for Safari and Opera
browsers. Disconnect 2, launched in April 2013 as a Chrome
and Firefox extension, blocks some 2,000 third-party
websites that track you across the web. That vastly
expands the power of the service that initially focused
on a handful of portals Disconnect.me first kicked off
when Kennish was still at Google and created the Chrome extension for Facebook specifically, in
October 2010. Kennish notes that Disconnect 2 has gotten more
than 250,000 new users since launching in April and
that all the startup’s apps combined have more than
1,000,000 weekly active users. Within the current
range of software, it is charged on a pay-what-you-
want model. “Like Humble Bundle,” says Kennish, who adds, “Some of our
upcoming releases will also include freemium
features.” In addition to helping block some 2,000 third-party
sites that track users’ browsing histories, the
Disconnect 2 extension also helps filter out malware
and encrypts data that you share on sites “to prevent
wireless eavesdropping.” The company also promises
that by cutting down on a lot of the tracking noise, users are actually able to see faster-loading pages
and use 17% less bandwidth on average. “Increasingly, people want to know who’s tracking
them online and want to have a say about what
information is being collected about them,”
Oppenheim noted in a statement. “Our software is
designed to put users back in control so they can
decide how their personal data is used,” adds Kennish. Longer term, the company also hopes to focus more
on protecting users around the various features of
data mining. “We’ve always thought one of the
biggest threats to people’s online privacy is just how
big data mining is getting,” noted Kennish. “There’s so
much personal data being collected about us in so many places now and all that data is susceptible to
being used in ways we don’t want. So our goal is to
help people minimize the unwanted collection and use
of their data. We started by tackling third-party
tracking because most people don’t know their
browsing history is being tracked by thousands of invisible websites they’ve probably never even heard
of.” The company is also becoming increasingly focused
on security services? “We think there are way
too many holes in online consumer security, which
recent events have made even more obvious, and we
want to help plug some of those holes.”

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Sunrise, the Google-friendly calendar app that
focuses on design, may have some competition
coming from iOS 7, but even with the added pressure,
the Sunrise team is clearly making strides. Today, Sunrise was updated in the App Store to add
support for foursquare check-ins, CrunchBase and
Google Maps, along with some design tweaks. The biggest part of the update comes via foursquare.
Users now have the ability to see their past
foursquare checkins direct from the app, complete
with mapping support. As the folks over at Sunrise
know, the more information you can source from a
single app, the better. Foursquare integration makes sense, considering that
the Sunrise team is made up of ex-foursquare
engineers and designers. In fact, it’s a wonder why it
took so long to bake in the location-based social
network in the first place. Foursquare integration transforms the calendar into a
log of where you’ve been just as much as a plan for
where you’ll go. Speaking of where you’ll go, Sunrise also added
Google Maps integration to the app instead of Apple
Maps, which should make many a weary traveler feel
just slightly better on their way to someplace new. But the update isn’t just about where you’re going, but
how awesome you are at life when you get there. That
said, Sunrise has baked in support for CrunchBase, a
database of people, companies, and investors that is
a part of the TechCrunch network. CrunchBase
support will now automatically pull in extra data about companies and people you’re meeting based on the
domain of their email address. In terms of design tweaks, Sunrise has switched up
multi-day events to show their duration on the main
view, with a countdown for the duration left of the
multi-day event. Moreover, the app now offers
cilckable links for all phone numbers, websites and
addresses. Sunrise v 1.4 is available now in the App Store for
free.

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DotEEBubble is one of the most controversial startup
blogs in the world and you’ve probably never heard of
it. In the rah-rah world of entrepreneurs, accelerators,
and incubators, it’s rare to see much talk about the
problems with the government-funded VC model and
how the biggest players look more like scamsters than bootstrapping entrepreneurs. That’s just what
this blog is – a cold, hard look at the problems that
come when you throw big money at little ideas. The blog, written by an anonymous commenter in
Estonia, is a cross between a research-heavy
economists report and a jeremiad against what looks
to be a EU-funded startup bubble. With excitement
rising about ventures throughout the EU, the site’s
calm, reasoned take on Estonia’s darlings is stirring up quite a bit of controversy in the small country. One startup that we prominently covered, Fits.me, a
clothing fit “startup” that uses robotic mannequins to
show you what clothes will look like on your body,
took 3,773,456 euros of government money over the
past few years. The company has been in business
for seven years in total and its customer implementations are either well-hidden or nonexistent.
In short, the company looks like a dog. DotEEBubble
writes: In summary, we have a company that has been
around for many years with little success, a
questionable product, and few customers. This
doesn’t seem like a recipe for success.We could be
wrong of course. Maybe a large retailer like Amazon
will just buy them out. Maybe robot mannequins will take over the world, and form the new ruling class.
The future is hard to predict.
The blogger who runs the site refused to be named in
this piece but he took a bit of time to explain his
methodology, his beliefs, and the reasons behind his
thorough takedowns of what he sees as excesses in the Estonian startup market. It would be interesting to
see a similar tack taken in other markets. His model
could be exported but it’s clear his style and intensity
can’t be matched. John Biggs: Why are you doing this? DotEEBubble: Many in Estonia have been trying to
pitch the country as the “startup nation,” but the
details paint quite a different picture. In talking with
some other business people in Estonia, I started
realizing a lot of this is not quite what they make it
out to be. A lot of the startup community and companies are propped up through taxpayer money,
much of it from the EU. What’s worse is that no one in the media was
bothering look under the covers to realize how much
of this was built through public funds. I decided to
start the blog to bring some of these companies to
light. Estonia receives a massive amount of EU funding
(more than 18% of the 2012 budget), and I think
they’ve chosen to spend too much of it on risky
startup companies and startup incubators. It reminds
me of the .com days in the US in the late 90’s, when
there was too much money chasing too few good ideas. The difference is that in Estonia, the money is
coming from taxpayers and not private investors. I would not be so critical of this use of public funds if
everything else was going well in Estonia, but it’s not.
Estonia has the lowest GDP (per capita) in the
eurozone, and its people are the second poorest
among eurozone members when measured by assets
held per person. There is a television show (Kodutunne) on an Estonian television channel that is
similar to Extreme Makeover : Home Edition in the
US. They pick out a needy family in a rural area and
renovate their house. The difference is that in the
Estonian version, most of these families live in
homes without indoor plumbing or hot water! It’s unconscionable that there are people living in these
conditions while at the same time the government is
giving millions to risky startup companies. I think they
need to reconsider their priorities when it comes to
public spending. It was eye-opening what we uncovered. In one case,
a company set up in both Estonia and the UK at the
same time, in order to take advantage of taxpayer-
funded support intended for companies in each
region. Another company we wrote about got millions
of euros, over the course of many years, to fund robotic mannequins. In many cases, the companies that received
government money were being run by people with no
experience in the field. We wrote about an incubator
for gaming startups, where none of the people running
the incubator had ever worked in the gaming industry!
Then there was the incubator that received nearly 700,000 euros from the government to set up in a
small town of 20,000 people to promote creative arts
startups, which as far as we can tell was just a few
women making dresses and jewelry. We also wrote about a private equity fund with more
than 100 million euros under management, that
received over 100,000 euros from the government to
market their fund abroad. Do they really need this
kind of aid? The main criticism is this is all being done with
taxpayer money. If private investors want to spend
their money on these companies, that’s fine with me.
That’s how it seems to work in almost every other
country. JB: Who are you? DEEB: There is more than one person behind the
blog, though I am the primary author of most of the
posts. I own a successful Estonian software
company, and we built it through hard work and
without government handouts. I’ve been in the tech
industry for many years, so I was around to witness the dot-com crash in the US that happened a number
of years ago. None of the people behind the blog have any stake in
any of the companies profiled on the blog, so we have
nothing to gain or lose when these companies do well
or poorly. I like to see startups in Estonia do well,
which is why I mentor some companies and also give
training sessions. I never accept any payment or stake in the company for it. It’s my way of giving
back to the community. JB: What can governments do to fix these sorts of
problems? Should they be investing at all? DEEB: One of the co-founders of TechStars, Brad
Feld,wrote a good post about why the government
should not be in the incubator business, and I agree
with him. As for the government investing in startups, I can
only see it being necessary in rare cases, like in
cases where there are externalities involved that
benefit the public. One example would be a new type
of clean energy technology that may not be profitable
on its own, but with environmental benefits to society that make it worthwhile. This isn’t what is happening in Estonia though. The
companies we have profiled on our blog include a
social network for household pets, and a browser-
based e-book reader. The government shouldn’t be
wasting money on these types of ventures. By our
estimates, the largest investor in Estonian startups in 2012 was the taxpayer. They poured more money into
Estonian startups than all private equity combined. Some will say that the reason the government is
stepping in is that there is no private equity market. I
disagree. Good ideas will always find funding, and
there’s even an Estonian Venture Capital Association
with plenty of members. JB: What is the primary problem in the .ee
environment? Is it widespread? DEEB: Imagine opening up the newspaper every
summer and reading about how many schools will not
open their doors again in September due to lack of
enrollment. That’s actually what happens in Estonia. The Estonian population is rapidly declining, through a
mix of emigration, low birth rate, and low life
expectancy. It ranks 228 out of 232 countries when it
comes to population growth. Net emigration last year
was over 6,600 people, and the majority of those were
people in the 20-34 age group i.e., people in their prime working years. This may not seem like a large
number, but Estonia is a small country with a
population of less than 1.3 million. Last year, the total
number of students in 12th grade was 7,810. Imagine
if 85% of all fresh high school graduates in the US left
the country the day after graduation, and that gives a better idea of the impact. The government isn’t doing much to address the
problem, though I think this is common in many
countries with long-term demographic problems. It’s
easier to ignore it since the impact is not immediate
or sudden. Admittedly, it’s a tough problem to solve. My theory
is that a lot of the emigration is driven by quality of
life issues. That’s not easy to fix, but throwing money
at startup companies does not seem like the solution. JB: Are people mad at you? DEEB: The main criticism we receive is that the
blog’s authors are anonymous, but I think this is from
people eager to attack the messenger because it’s
difficult to attack the message. We’re very careful
with our fact checking and post links to our source
material. As for the reason we’re all anonymous, it’s important
to understand that Estonia is a small country, and all
members of the startup community could easily fit in
a high school auditorium. The community is too
close-knit to write what we do any other way.
Besides, none of us need the fame. We’d rather readers focus on the message not the messenger. Other than the criticism about anonymity, the
feedback we’ve received has been quite positive, and
readers tell us that this is the first time anyone has
bothered to analyze the startup community in Estonia
with a critical eye. We’ve heard that many high-
ranking Estonian government officials are regular readers of our blog, and it’s also required reading in
some entrepreneurship courses in Estonian
universities. JB: So what do you like in Estonia? DEEB: Estonia is a great place to first launch a new
product or technology, because the country’s small
size makes it easy to implement. For example, let’s
say you’ve come up with a personal finance tool that
requires access to the user’s spending details from
their bank account. In Estonia, there are only five consumer banks, so it’s easy to set up those
relationships since you only have to talk to five
banks. One cool thing in Estonia is how the government is so
open and online. It makes it easy for people to track
what’s going on and get information. In fact, so much
data about government spending is online that if we
can’t find information about government spending on
a project after 5 minutes of searching, then that’s a sign that the project manager may be trying to hide
their spending, and it makes us more likely to write
about them.