Getting Millions of Downloads for an iPad App

When it comes to the enterprise, the iPad has become a must-have for presentations.  And this has certainly been a big boost for Prezi.  The company has a top app that takes advantage of the iPad’s awesome capabilities.

So far, it has gotten nearly 2 million downloads.  In fact, Prezi is adding about 1 million users per month!  It’s the kind of growth that’s been seen at breakout companies like Dropbox and Facebook’s Instagram.

To learn more, I had a chance to interview Prezi’ co-founder and CEO, Peter Arvai.  Here’s what he had to say:

Q:  What was the inspiration for the company?  Keys to the success of the business?

A:  My co-founder Adam Somlai-Fischer is a media artist who was gaining international acclaim and speaking frequently at conferences. He needed a presentation tool that allowed him to show the big picture as well as dive into the details.  As an artist, he continued to leave a great impression on his audience with his canvas-based presentations.

My other co-founder, a Budapest University professor, Peter “HP” Halacsy, noticed Adam’s unique presentation tool and wanted to use it for an upcoming talk of his own. He reached out to Adam and used the hand coded platform to create a very well-received presentation.

Afterwards, HP realized they might have a product on their hands. At this point, HP and Adam knew that they needed help to build a company and a product.

I am a serial entrepreneur who has long believed that everything great about humanity starts with people sharing ideas.  I saw this technology as a new way to do that.  I was inspired by the potential of this idea-sharing technology and convinced HP and Adam to begin working on the project fulltime. I moved from Sweden to Hungary in 2008 to become Prezi’s CEO. HP became our CTO and Adam our Head of Design. We launched Prezi in 2009 and the company has been cash flow positive since year one.

Q:  What are some of the lessons from building an iPad app?

A:  The most important lesson was understanding that the iPad app (or our iPhone app) is part of a multi-platform family of products that require a seamlessly integrative user experience across different surfaces.

While the prezis people watch on these devices are the same, the experience needs to be tweaked to fit the different use cases. Learning about the nature of how people use these devices to share ideas was very important for us in order to make the experience right.

Q:  What do you attribute the hypergrowth od the app?

A:  Prezi is a very engaging and fun way of developing and sharing ideas. There are studies that have shown that stories told using Prezi as the medium help audiences understand and remember more of the presentation than compared to using slides.

But there is bigger trend here: the bar on creativity is rising and companies’ ability to survive is increasingly dependent on encouraging creative output.  As a company, you are only as good as your recent idea.

This being the case, companies are forced to be agile and produce creativity on demand.  Prezi on the iPad lends itself very well to this new trend as it’s mobile, has an interesting and unique platform and can be edited on the go.

Marissa’s Manifesto: Good or Bad for Tech?

Like her or not, Yahoo’s (NASDAQ:YHOO) Marissa Mayer has ginned up lots of PR!  Of course, the latest bombshell was her decision to get her remote workers back to the office.

No doubt, it does seem like a retro move.   Isn’t collaboration technology supposed to be critical for success?

Well, perhaps not.  In fact, Mayer does have supporters in the tech world.

And one is Roman Stanek, who is the CEO and founder of GoodData.  He knows how to create breakout technologies and build top-notch teams.  As for GoodData, the company has over 8,000 customers and grew revenues by 5x last year.

So here’s his take on the Mayer brouhaha:

Q.  Why do you like Mayer’s decision?

A.  I’ve always believed that working from the office is the best option. There’s a chemistry of collaboration and interaction that percolates when people are working side by side. It creates a common bond —a collective mindshare, if you will — that leads to real leaps of productivity and creativity.

I’m in the office almost every day because I believe it is particularly crucial in fast-changing environments (like startups) for people to be constantly synchronized. That’s the phase that Yahoo is in now.

Are there exceptions? Yes, we live in a distributed world. Talent is international. But there’s no equivalent to working in an office, together as a team working side by side, building companies and having fun. I believe this creates an atmosphere of ad hoc brainstorming. That’s true excitement: a mind meld of creativity that only happens when people work closely together.

Q.  Advice for managing a growing team?

A.  HP invented management-by-walking-around (MBWA) in the 1970s, and I still believe it is very helpful approach. It’s a style of business management where managers wander around at random to check in with employees about the status of work. In effect, managers are being proactive in ensuring that employees are contributing at the levels they need to be. There is no MBWA when everyone works from home. Sadly, HP no longer adheres to the MBWA style. I’ve heard their offices described as a sea of empty desks, because so many employees work remotely.

Q.  Are there any technologies you feel will win or lose as technology and mobility continue to proliferate into the workplace?

A.  Cloud computing has become so mainstream it’s now equated with mobility. That, along with the BYOD trend, are already winning in the workplace. I expect social networks for the enterprise will eventually become more widespread as companies experiment with new ways to connect their employees, their suppliers and their partners. I firmly believe big data analytics will play an increasingly important role as companies strive to make it easy for all their employees to glean meaning from the volumes of data pouring in from legacy systems, from sensors in factories and cars, from Internet searches and from social media.

Q.  How does GoodData approach this delicate balance? Is there an ideal solution?

A.  We use Skype and Google Hangout extensively. But there isn’t — and I don’t expect there to be — a full replacement for meeting with somebody in the office or simply talking to people in the hallways. I’m a big believer in MBWA, and I encourage others to do the same.

Investors Double Down on Zynga

PincusWhen it comes to Zynga (NASDAQ:ZNGA), investors only seem to care about one thing right now:  real-money gambling.

The company’s Facebook (NASDAQ:FB) business has faltered, and Zynga still is trying to find ways to get traction with mobile games. But when it comes to real-money gambling, Zynga could be in an ideal position.

Good thing. Nevada just legalized it.

ZNGA shares have shot up nearly 20% in two trading days both on the news that Nevada gave a green light to real-money gambling over the Internet, and on the hope that other states — such as New Jersey, which has made moves in that direction — eventually will follow suit.

Zynga had applied for a gaming license in Nevada, which could be approved within a year or so. The company also previously struck a partnership with Bwin.Party Digital Entertainment, a provider of real-money gambling in Britain.

The U.S. market likely is the largest opportunity. Yes, other operators — including Glu Mobile (NASDAQ:GLUU) and Caesars Entertainment (NASDAQ:CZR) — are gunning for it, but Zynga could be the biggest beneficiary. Its Zynga Poker franchise has a staggering 26.4 million monthly active users, according to AppData.com, and it’s not unreasonable to think Zynga could get part of its user base to convert to real-money gambling.

BMO analyst Edward Williams thinks the revenue opportunity for online gaming could be “in the billions.”

If so, Zynga’s stock — which currently is inexpensive at a low 1x enterprise-value-to-sales ratio — could have much more room on the upside.

Signs You Have an Idea For a Breakout Company

The early days of a startup can be exhilarating.  But there are also many challenges.  Perhaps the biggest:  is the idea good enough to build a great company?

It’s something that bedeviles all entrepreneurs, even great ones like Facebook’s (NASDAQ:FB) Mark Zuckerberg and LinkedIn’s (NYSE:LNKD) Reid Hoffman.

So what are the signs that you have a great idea?  Here are tips from some successful entrepreneurs:

Jeff Ma, CEO of tenXer

“The classic notion is that innovation comes from solving a problem but this is an oversimplification. Really innovation or great ideas are all about spotting a better way to do things. Because of that, it’s often not the idea that is important but the execution of that idea. Look at a company like Twitter. Did they really solve a problem? No. But did they create a better way of doing something? Absolutely. And they have executed incredibly.

“When I hear a new idea, I always think first off whether it will work. i.e. will people use it. Then, I try to understand how big the addressable market is. If it passes that test, I then think about how easy it will be to reach critical mass and finally about when there will be a viable business model.”

Peter Bauer, CEO of Mimecast

“The trick is to maintain the discipline to rigorously test the idea, refine it and pursue it as pressure mounts to discard it. Ideas are a dime a dozen, but people who can build businesses based on pursuing and refining ideas over many years are few.”

Michael Alden, President and CEO of Axceler

“History repeating itself is usually a clear sign that your idea is a good one. We saw this when we transitioned our business from Lotus Notes to Microsoft SharePoint. Our Lotus business was healthy because it was a disruptive collaboration technology that lacked administrative capabilities – what we offered. When SharePoint launched — which was another disruptive collaboration technology — we saw an opportunity to do the same.  And our business soared. Now we see the same signs with different disruptive collaboration platforms like Jive and Yammer.”

CEO Lessons for Tough Times

CEO's And Corporate Executives Gather For Annual Allan And Co Gathering In Sun ValleyCEOs must deal with many complicated issues, such as creating a standout product, finding customers, getting money from investors and recruiting top-notch talent.

Even highly successful companies have tremendous problems. Just look at Groupon (NASDAQ:GRPN). Not long ago, it was a darling of the tech world. But lately, there has been buzz that the company’s CEO and co-founder, Andrew Mason, may get sacked!

So how can startup CEOs deal with the inevitable challenges? To see, here’s some helpful advice:

Damon Schecher, CEO of Shipwire

“During tough times, I remind myself that my board and the public want me to succeed, but they also want me to be authentic about the problems and the path forward. They prefer brief phone updates. They prefer being engaged as thought partners. And in return, over the years they’ve given me surprising leeway and loyalty.”

Scott Sellers, CEO and Co-Founder of Azul Systems

“Every CEO deserves a learning curve. Your board and investors will give you the chance to succeed, however, you have to be dedicated to not only executing on strategy – but even more importantly – being an excellent communicator. I would break it down to four critical success factors: 1) Your priority needs to be your people. Be visible, support your team, and help them stay focused on what they can control. 2) Listen to what the market is telling you. Sometimes the business model that built your company needs to change. 3) If you have to make changes (in either people or strategy) – make them quickly, and openly. 4) Know what you are good at – building a business takes a different skillset than sustaining one, or executing a turnaround. Finally, bring on some trusted advisors as part of your core management team and board that can come up with creative ideas as well as execute on them in the eyes of the market.”

Ethan Oberman, CEO of SpiderOak

“The ascendancy of any company is never a straight line but rather littered with bumps, obstacles and challenges along the way. These ‘scars’ give a company character and an inherent ability to deal with those days or months that don’t go as well as others. As CEO, there is no substitute for an uncompromising belief in the company’s vision. Emotions must never be allowed to swing wildly in one direction or another but should remain balanced – showing excitement and disappointment – but never to the point of alienation. These two elements combined are the key to weathering difficulties and finding success on the other side.”

Larry Lang, CEO of Quorum

“As a Duke basketball fan, in difficult times I recall Coach Krzyzewski’s philosophy of ‘next play’ from his book, ‘Beyond Basketball’. It’s a reminder not to dwell on whatever bad thing recently happened (or good thing, for that matter), lest the past distract you from the task at hand. Instead, pause to gather any lessons, but mainly – move on.”

Marcus Ryu, CEO of Guidewire

“CEOs must adapt their message, framing, and diction just to get their point across to multiple audiences — from customers to investors to the board — while staying true to the same reality. And great CEOs can inspire and motivate all of them.”

Finding the Right Technical Co-Founder

It’s true that having a co-founder is not a must-have for a successful startup. Just look at breakout companies like Facebook (NASDAQ:FB) or Amazon.com.

But having a co-founder can certainly be a big advantage, in terms of vetting ideas and offloading the work.

Yet there’s a problem: How do you find the right one? It’s certainly not easy, especially when looking for technical co-founders. They are in high demand and often have many side projects.

So to get some perspective, I talked to a variety of successful tech entrepreneurs. Here’s what they had to say:

Mark Lucas, CEO, mySudo

“Deciding on a co-founder was more than simply locating someone who can write code and engineer solutions. The person must understand the vision and share your passion for the business. He or she must be willing to take risks and sacrifice time, without knowing the outcome of the efforts.

“So how did I go about doing this?

“Once ready to sell my vision, I went to where the technical resources are. In Rochester, I attended tech startup meetups, developer meetups, and networking events. I took my time, and eased into the relationship.

“I found a great potential co-founder, and got him engaged in the project in phases. First, it was to help build a spec and estimate for the application. Next it was to build a detailed requirement document with use cases. As we started working together, we slowly began to build a relationship and realized we shared the same passion for the idea.

“Today, I have 3 co-founders across design and technical operations and together we’ve secured funding for the startup which will launch in the coming months.”

Peter Bauer, CEO, Mimecast

“It is critical that you have at least a 30% skill set overlap. I don’t think a non-technical CEO and a commercially naive CTO will easily build a success together. They really have to both enjoy the overlap as well as the distinctions between their skill sets and interests.”

Brian Halligan, CEO, HubSpot

“Ultimately, there needs to be mutual respect on both sides, not just for the individual, but for their role. Business oriented co-founders who think technology is just a means to an end and it’s just a matter of outsourcing it to the right outside firm will fail to attract a great technical co-founder. Similarly, technical co-founders that think ‘business types’ are a necessary evil are also misguided.

“The most important thing when forging an early startup team is communication and clarity among the founders. They need to ask themselves the hard questions. What do we want out of this company? What do we do if someone tries to acquire us? How do we feel about outside investors? What happens if one of us decides to leave the company? Who gets to fire one of the founders — under what circumstances? How will we compensate the founders? There are many questions that co-founders should be asking each other.”

How to Build a Company Without VCs

I recently met up with Ethan Oberman, the CEO and co-founder of fast-growing storage operator SpiderOak.

There are many players in the market, but Oberman stands out because he has built his company without the help of VCs. This certainly is impressive contrasted against Dropbox and other rivals that have raised hundreds of millions of dollars. Not to mention that the company has been able to grow amid larger operators like Salesforce.com and Google encroaching upon the market.

So how did the company pull this off, and what can entrepreneurs learn from SpiderOak’s success? Here’s what Oberman had to say:

Q: Why not use a VC at least for the early stages?

A: During the early days of a startup, I have found it valuable not to be subjected to the pressures or whims of a VC who is trained to push-push-push toward growth-growth-growth. The phases of development can be bumpy and mistakes are always made. Further, it might take longer than expected for the true market to become clear and the applied pressure can force bad short-term decisions that may be deemed as necessary.

By way of example, when we started SpiderOak back in 2007, the thought of selling into the enterprise market was non-existent as large companies were not willing to “embrace the cloud” and associated technologies. Fast-forward five years: The enterprise market is now where we are experiencing our most exciting growth, as our product is designed and implemented for success in the enterprise environment.

Q: What are some of the things that worked for you in bootstrapping your venture?

A: With our focus on bootstrapping and “proving the theory,” we were able to go at our own pace while watching and studying the market closely. We not only watched and learned the missteps of our competitors as they constantly rushed to and fro, but we also firmed up our own understanding of what works and what doesn’t on a smaller scale. Imagine that it hurts more to fall from 50 feet than it does from 5 feet. The frugality also allowed us to retain control such that we could make decisions that were best for us.

Another advantage we capitalized on in this modern era of the Internet was the global work force. From the beginning, SpiderOak has been a virtual company. Not only did this keep our costs down as we had no office or lights or pencils, but it also gave us the opportunity to call on talent wherever it might live. Competing with companies in San Francisco or New York or Chicago can be costly — especially when on a budget.

Q: When is the right time to go for larger funding from a VC or strategic sources?

A: Once your product has found its niche, experienced success stories and can stand on its own two feet, this is the right time to raise money from a VC. In the early going, it is just not possible to know the specifics of where you want to head or how the market will change or how your product will be perceived during this change.

Tech CEO Shows How to Disrupt a Giant

In tech circles, the word “disrupt” gets thrown around a lot. It almost seems reflexive.

Yet the fact remains that it is incredibly hard to take down corporate giants.  Besides having enormous resources and entrenched customer bases, many of these operators have also learned some important lessons over the years — and realize they need to remain nimble and take risks. Consider how companies like Oracle and even Microsoft have remained giants for decades.

Despite all this, there are still opportunities for startups to inflict severe pain on incumbents. Just look at Quorum, which is a top player in the disaster recovery market. All in all, the company is becoming a major problem for rival Symantec (NASDAQ:SYMC).

I recently had a chance to talk to Quorum’s CEO, Larry Lang. Here’s what he had to say:

Q: When the company launched, was the goal to disrupt the market?

A: In 2008, Quorum was spun out to commercialize technology originally developed for shipboard naval computing. In combat systems, destroyed servers must be restored quickly and automatically. The original team realized that introducing this technology into the commercial market could disrupt the status quo of traditional backup systems, which restore failed servers over a day or more. By combining automated recovery, virtualization for instant availability, deduplication for efficiency, and cloud data centers for reliability, Quorum could provide small to mid-sized companies disaster recovery in minutes, which was previously only available to the largest enterprises and governments.

I think this exemplifies the “low-end disruption” described by Clayton Christensen.

Q: Before disrupting a market, what are some things an entrepreneur should do? Mistakes to avoid?

A: An entrepreneur should ensure that a market is ripe for disruption. A classic “ripeness indicator” occurs when technology makes available capabilities to a broader market, previously available only to the largest organizations with huge budgets and armies of technicians. Recall how the PC made computing available to small businesses and department managers, previously available only to corporations that could afford mainframes. A PC didn’t offer all the features of a mainframe, but it was a huge advance compared to a typewriter or adding machine. Likewise, Quorum offers one-click recovery systems that may not offer all the features of multiple replicated data centers, but it’s a huge advance compared to magnetic tapes trucked to a remote warehouse and is much easier and simpler to implement.

Disruptive technology should also offer “wins” on two levels: for the businesses adopting it, and also for its early champions. The PC made businesses adopting it more efficient, and also advanced the careers of its champions. Imagine the department head rapidly updating her budget using a spreadsheet, while her colleagues continue to struggle with adding machines.

Q: Why is disruption a good strategy? 

A: Disruption is a good strategy because it allows new technologies to start in market corners where incumbents don’t notice, or even if they do, they dismiss it as unimportant. If major corporations are spending multiple millions of dollars on mainframes, why worry about a department or small business only spending a few thousand dollars on PCs?

Likewise, if international banks are spending millions of dollars on building replicated data centers in case of major disasters, why worry about a small regional bank that wants to stay open for its clients no matter what? Yet by focusing on the practical needs of such customers, attentive to their budget and time constraints, Quorum is tapping into a hidden market worth billions of dollars.