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- 09/08/16--06:57: _The 17 best college...
- 09/09/16--07:15: _We talked to the fo...
- 09/11/16--07:00: _We talked to the st...
- 09/11/16--09:30: _This guy's startup ...
- 09/12/16--14:07: _Twilio CEO explains...
- 09/12/16--20:54: _Ford paid more than...
- 09/13/16--09:24: _We checked out Arci...
- 09/20/16--07:02: _I tried MealPal, th...
- 09/20/16--10:44: _A 'tourist investor...
- 09/20/16--12:00: _Antidote is a digit...
- 09/21/16--04:00: _This 24-year-old Ha...
- 09/21/16--10:44: _It's been a rough y...
- 09/21/16--12:37: _Inside the catastro...
- 09/22/16--12:40: _This startup is bui...
- 09/22/16--15:25: _Two famous Google a...
- 09/23/16--10:51: _Millennials aren't ...
- 09/25/16--07:00: _This is the one qua...
- 09/27/16--05:00: _These former Apple ...
- 09/29/16--09:20: _Squarespace's New Y...
- 09/29/16--09:23: _I've been advising ...
- 09/08/16--06:57: The 17 best colleges for startup founders
- 09/12/16--20:54: Ford paid more than $65 million for shuttle-van startup Chariot
- 09/21/16--10:44: It's been a rough year for startups, but it's getting better
- 09/25/16--07:00: This is the one quality every startup founder needs
While Peter Thiel is famous for paying wanna-be entrepreneurs not to go to college, there are still thousands of founders who do go to college and go on to form well-funded companies.
But there are some schools who tend to churn out more venture-backed founders than others.
In its 2016 report, PitchBook analyzed 10 years of startup data to determine which schools produce the most startup founders who go on to raise money from investors.
The data only takes into account whether the entrepreneur attended a school — so college drop outs are included in the count. (After all, it's a popular Silicon Valley thing to do).
Here are the 17 schools that spawned the most VC-backed founders over the last decade, ranked:
17. Carnegie Mellon University
Location: Pittsburgh, Pennsylvania
Entrepreneur count: 378
Company count: 324
Capital raised: $4.6 billion
16. Technion-Israel Institute of Technology
Location: Haifa, Israel
Entrepreneur count: 379
Company count: 323
Capital raised: $4.8 billion
15. University of Southern California (USC)
Location: Los Angeles, California
Entrepreneur count: 381
Company count: 341
Capital raised: $3.5 billion
See the rest of the story at Business Insider
Thursday was a day that Byju Raveendran, the founder and CEO of Byju's, will never forget.
Byju's is India's largest ed-tech company and its learning app has not just inspired more than 250,000 student subscribers, but also Facebook founder Mark Zuckerberg and his wife Priscilla Chan, who led an investment of $50 million in this app.
Business Insider spoke to Byju to find out what turned him into the phenomenal teacher he is.
Byju had a very humble beginning. He started his schooling in a village called Azhikode, in Kannur district of Kerala, India. Born to a pair of teachers, he went to a Malayalam medium school where both his parents taught.
It's rather surprising to know, however, that he missed most of his classes to play sports. He played six sports in school and pursued his interest up until the university level.
"Games teach you teamwork:
His favorite sports are Football, Table Tennis, and Cricket even though he pursues multiple sports genres even now.
He believes that a lot of learning happens outside classrooms and playing sports and games are crucial for any student. "These helped me in real life skills that helped me succeed in life', Byju says adding, "Games teach you teamwork, leadership skills, how to control aggression and perform under pressure. These scenarios you will never come across if you're only learning in a classroom."
While he played all day, his studies never suffered. He attributes that to the life skill that he learned on the sports field, in an unstructured environment. "The sports schedule forced me to start 'learning on my own' by asking questions. It takes less amount of time if the students take an initiative, especially in the subjects they like. Parents and teachers are important, but they mostly play a supportive role."
When Byju graduated College and started working as an engineer, during a vacation break, he ended up sitting for the CAT exam — the Common Aptitude Test, which students appear for in order to gain entrance into the elite Indian Institute of Management colleges that provide MBA degrees — alongside his friends, just for fun.
He scored 100 percent and was surprised that he had cracked one of India's toughest and prestigious entrance exams on the first try, without actually having prepared thoroughly at all. He sat for it again to test himself and repeated the score. For him, the exam was another game he loved to play.
This success got the students flocking to him, first his friends, then friends of friends. He figured he quite enjoyed teaching and conducted CAT workshops for free, starting with 35-40 students, going up to 1,000 in a matter of weeks.
This overwhelming response validated his method of teaching, where he taught students how to predict questions, instead of memorizing them. This method of familiarizing students attracted students from different cities to Bangalore (India's Silicon Valley), where he had started.
He quit his job as an engineer and took up teaching full-time, even traveling to nearby towns to reach as many students as possible.
From coffee shops to rooms to auditoriums to stadiums, there wasn't a single place in the city where Byju's classes weren't running. He turned to the digital platform when he realized that he could make learning fun for many more students, simultaneously.
Getting over rote memorization
The Byju's learning app, which is making learning contextually and visually appealing, has seen over 5.5 million downloads. It was released just 12 months back and the founder is stunned by the response he has seen from school students. He is focused on younger users because, he says, "4th- 5th grade is the starting of your formative years in education. It is the time when you can really feel the subject, realize what you're good at. It is the best time to reach out to students." '
He laments the current educational system in place in India, where rote learning is prevalent. "The exams get over and you forget everything you learned. Students fear exams because they see it as an end goal. When the focus is more on marks and grades, the result is that you miss out on the learning part. Assessment is a part of learning, not just learning. The focus should be more on learning, that's when exams get below your level."
Byju insists that the only way to succeed is when every student is playing to his or her strengths. "It is important for every student to find out what they like and figure what they're good at." His favorite subject was math, a subject that most of us dread. He was a National level Math Olympiad winner in school, and that same focus and dedication towards his most loved subject is what led to the creation of Byju's.
Of the investment from one of the world's most famous tech founders and his wife, Byju says, "They were personally excited about our story and our impact in the Indian metros. Both of them understand technology and they are very excited by our offering as we are creating a product that is technologically driven to enable better learning while reaching more and more people.
One of the reasons HBO’s “Silicon Valley” is such a hit rests in how effortlessly it skewers the tech scene.
The reality is often so ridiculous that the show even has to pull back sometimes, otherwise viewers would think it’s too absurd. Perhaps the show’s most beloved character is the extreme blowhard Erlich Bachman, played by TJ Miller, who takes credit for everything good that happens to Pied Piper while contributing little beyond platitudes.
Miller’s delivery and demeanor are priceless, and he claims the character is based on a particular person: Binu Girija, the founder of Way.com (or just Way).
“He really was an arrogant blowhard who had no coding skills, but just was a fairly good salesman who smoked marijuana a lot,” Miller told TechCrunch in 2014. “And that’s kind of where I got my character.”
Miller’s impression of Girija was based primarily on one chance meeting and an awkward pitch, Girija tells Business Insider.
Girija, in fact, does have a coding background, and studied computer science in university in India before working at Oracle and then founding a string of four startups. Two of them completely failed and two had mildly successful exits, he says.
Unfortunately, Girija says he put the money from his successes into one of his failures and ended up losing it.
“Whatever money I made, I lost it here,” he says.
But in 2013, Girija founded Way.com, which is what brought him into Miller’s orbit. Way, which raised a $1 million seed round half a year ago, is a "online marketplace for services." Think about Amazon listing what you can buy from third-party sellers, and then apply that to things that aren’t just retail goods.
Girija explains it in terms of three things: time, location, and personalization.
“Let’s assume you are ordering lunch,” he says. “You have a time [you want to eat]. Then you pick a restaurant: location. And then you pick the cuisine, that’s personalization.” Anything that has those three elements, a vendor can list on Way, and Way will help connect them to the buyer. Way doesn't produce anything in-house.
In explaining his ambitions for Way, Girija invokes grand marketplace comparisons, like Amazon and eBay, which might have contributed to Miller’s blowhard salesman impression of him.
Girija says he met Miller at a random event, and followed him. “Hey TJ, would you have five minutes to talk ideas,” he asked.
“Who are you?” Miller replied. That’s when Girija immediately began pitching him Way. Miller began to walk away and Girija inserted the Amazon comparison.
“You've got three minutes,” Miller said.
But as Girija kept talking, it was clear that Miller wasn’t getting the idea, Girija says. So Girija pulled out his phone to try and show him, but the site was spotty and the screen was just loading and loading. Girija says he got nervous and kept talking fast, and his accent is, admittedly, a bit hard to understand at times.
“He might have thought I was high,” Girija laughs.
Girija is pretty good-natured about Miller's comments. He did get free exposure out of it, after all. But he takes issue with one particular bit of Miller’s commentary. “I’m not arrogant,” he says. And indeed, he does seems much more self-deprecating than Bachman is in the show.
However, like Bachman, Girija is a bit prone to the sweeping statement.
One of Girija’s cofounders left the company as soon as the company secured the initial investment. This is what Girija says as a explanation: “There are some people who are born entrepreneurs. But some people purely look for an opportunity to get the money and run. Those I'll call ‘the runners.’ [My cofounder] was a runner.”
That’s a mini speech I could definitely hear coming out of Erlich Bachman’s mouth.
An Israeli startup called prooV is building what it calls the first "proof of concept" platform, which lets an enterprise test-drive a startup's technology before they sign a purchase order for it.
Toby Olshanetsky, founder and CEO of prooV, has spent his 20-year career building enterprise software, mostly for startups, he says.
He says the idea came "out of the pain I experienced."
The process for an enterprise to buy a startup's technology pretty much goes like this: Startup pitch the tech. If the IT folks like it, they install it on their test/development computers and play with it.
If they think it will work for their company, they install it in a limited fashion in a more realistic way and make it work with other their apps and devices. This is called a "proof of concept" (POC). They might even roll out a POC on their real network to limited employees to give it a bigger test drive, before spending big bucks to buy the app and set up for all employees for real.
It is this POC stage that prooV is trying to simplify. So, it's not the same thing as a way for developers to test their apps before they release them (aka, a TestFairy or TestFlight). Nor is it a way to set up a cloud-based development/test environment (aka Ravello Systems, acquired by Oracle).
A startup has to have its software far enough along to be sold to an enterprise.
"A startup signing to prooV has to go through a validation process. We want to make sure it can actually do POC,"Olshanetsky says.
The enterprise can then use the prooV service to securely trial the startup's software on their actual network. And it can be used like a dating service for startups and validated enterprises to find each other.
This is a big, hard problem to solve and prooV is so young, there's no guarantee it will succeed just yet.
But there are some good signs. For instance, even though the company just came out of stealth this week with $7 million in Series A funding, it's already gaining a bit of traction, Olshanetsky says. The company has signed up 300 startups and 44 enterprises that are beta testing its platform, running 91 pilot tests, he tells us.
It also has the backing of one Israel's most innovative VC firms, OurCrowd, which allows average investors to invest in startups at the same terms given to high-end VCs. OurCrowd was founded by one of Israel's most prominent VCs, Jon Medved.
ProoV is also backed by Luxembourg-based VC Mangrove Capital Partners.
Startups can go boom and bust overnight, and part of the fallout is leaving its customers in a lurch.
Startups, especially in the cloud space, can be seen as risky bets because they're asking customers to trust them with their data and operations with no guarantee that the company is in it for the long term.
That's the main reason why Twilio decided to go public and prove it's in the business for awhile, said CEO Jeff Lawson onstage at TechCrunch Disrupt.
"Trust is the number one thing you sell as a cloud company. That can be software-as-a-service, or even more importantly as a developer platform. You're saying to customers trust us with your applications, build on top of us and know we're going to keep delivering for you," Lawson said.
"And the best way to deliver on trust and to show that customers should trust you, I thought one of the great things you can do is actually become a public company."
For one, the business operations are laid bare so you know how healthy financially the company is and how fast it's growing. Compared to a startup whose financial metrics are obfuscated, potential customers might opt for the public company since it can see its financial health.
"People know that public companies are run as tighter ships than private companies as a general rule because you have to be, and that should also help engender trust with your company," Lawson said.
There's the money aspect of going public, too. Having raised venture capital, Lawson acknowledged that he had a duty to return it to investors and an IPO accomplishes that. While Twilio has seen its stock soar since going public, Lawson doesn't pay much attention to it.
"You can't believe that when the stock price doubles, you're twice as good as you were yesterday," he said.
Instead, he's thinking about how to "accelerate our trust" with customers.
Lots of software developers, particularly those building products for large enterprises, often rely on technology from large, established companies like Microsoft or Oracle — given the volatility of the startup world, there's a reasonable fear that they'll vanish overnight, making it difficult for them to rely on their products while they build important new apps or services. Twilio's status as a public company goes a long way to assuage those fears.
Last Friday, Ford bought shuttle-van startup Chariot in an all-cash deal. But the price wasn't disclosed, so it wasn't clear whether this was a case of a distressed startup selling for a bargain-basement price, or Ford paying a solid price for a strategic fit into its long-term plans.
Turns out it was the latter.
Business Insider has since learned that the automaker paid $65 million, plus earnouts to make employees with stock options whole. The startup had raised only one round of $3 million after emerging from startup factory Y Combinator in 2015.
As one person familiar with the deal said, it definitely wasn't an acqui-hire, and investors are happy with how it came out.
Chariot offers beleaguered Bay Area commuters an alternative to the overloaded mass-transit system. The startup uses 100 Ford Transit 15-seat vans to serve 28 crowdsourced routes, according to Ford. Currently, the routes are based on demand from riders, but after the Ford acquisition, data algorithms will take over and, Ford says, allow trips to be scheduled in real time.
Chariot CEO Ali Vahabzadeh previously told Business Insider that the deal took shape over more than a year and half, then accelerated in recent months.
In addition to the Chariot acquisition — the first by Ford Smart Mobility, the company's future-of-transportation unit — the carmaker announced that it would collaborate with the bike-sharing service Motivate in the Bay Area to integrate its services into Ford's FordPass app. Users will be able to access pedal-powered transportation through Ford's GoBike feature in 2018, when the service launches.
GM has also been making aggressive moves in the transportation-tech space, investing $500 million in Lyft and buying autonomous-car startup Cruise this year.
Chariot investors included SoftTech VC, Semil Shah, Maven Ventures, Major League Baseball Ventures, and Winklevoss Capital, among others.
It's easy to tell the difference between a motorcycle and car, right? One has two wheels, one has four.
Except that there are now plenty of vehicles available that have three wheels.
There's the Can-Am Spyder, the Campagna Motors T-REX, and the Polaris Slingshot, to name a few. There's also the Elio, which recently paid a visit to out New York office.
Soon to join the party is the all-electric Arcimoto SRK (those aforementioned rides all run on gas), effectively a $12,000 tandem three-wheeler motorcycle that can be outfitted with a fully enclosed "cabin" or converted to delivery van duty.
It might be the ultimate city vehicle. And we checked it out:
Arcimoto swung by our Manhattan office for a curbside briefing and test drive. It was a lovely day in mid-September. The Oregon-based startup has thus far taken about $8 million in funding and has worked through 8 prototypes of its vehicle.
They brought a pair of SRKs — one red and one blue.
That's Mark Frohnmayer, the founder. He's an entrepreneur who sold his previous company, GarageGames, before starting Arcimoto.
See the rest of the story at Business Insider
MealPass, a monthly lunch subscription service, launched in New York City in March 2016, but rebranded as MealPal this week.
The service was founded by the team behind ClassPass, a startup that gives customers access to a variety of fitness classes in a particular city for a flat fee. The model is similar to Netflix, where a monthly rate lets you pick from a selection of movies.
With MealPal, you get an all-you-can-eat subscription — you can pick up a daily (albeit not unlimited) lunch from participating restaurants. For the monthly price of $119 (without tax), MealPal gives subscribers lunch Monday through Friday — which means each meal costs less than $6.
Over 600 New York City restaurants have signed up to participate in the MealPal program. It's also available in Boston, San Francisco, Miami, Chicago, and Washington DC.
Now that the service has added so many restaurants for users to choose from, the options can get overwhelming. So on September 19, the program launched what they're calling a "Tinder for food" function. Users can swipe right or left on up to 100 ingredients they like or dislike. Then the app's bot will recommend meals based on those preferences.
I tried the service for a week before the new update when it launched in March. Here's what happened.
I was instructed to log on between 7 pm and 9:30 am before each lunchtime to reserve my food and select a pick-up time. With the update, you can now choose your lunch starting at 5 pm.
The Sunday night before the first day, I filtered by location, which narrowed my options down to 10 restaurants (though MealPal has since added dozens more) within a three-block radius of the Business Insider office. I chose pulled pork sliders from The Hog Pit.
On Monday, I ventured outside to pick up my food, which felt strange since I usually bring my lunch.
See the rest of the story at Business Insider
Over the last few years, tech startups have stayed private longer — thanks in part to a new class of "tourist investors."
While tech companies have traditionally raised money from venture capitalists, mutual funds have plowed money into late-stage startups, seeking the kinds of returns they previously would've achieved from companies going public earlier in their life cycles.
These so-called tourist investors, as PitchBook has labeled them, are a big presence.
Fidelity Investments, a mutual fund Goliath, has invested in the greatest number of tech startups that are valued at more than $1 billion — a type of startup commonly called a "unicorn"— according to PitchBook's 2016 VC Unicorn report.
Fidelity's 24 investments in billion-dollar US startups surpass top venture capital firms like SV Angel (23 unicorns), Sequoia Capital (20), and Andreessen Horowitz (20). T. Rowe Price, another mutual fund, rounded out the top five unicorn investors with 17 investments. The full chart is to the right.
Fidelity's investments include companies like Uber, Snapchat, and Pinterest, which are all under pressure to go public.
"Over the last few years, venture capitalists have generated impressive returns for their [limited partner investors]," PitchBook senior analyst Garrett Black said in a release.
"At the same time, private companies are staying private longer, the public market remains somewhat volatile and the rise of interest rates is still looming. These factors make investments into VC-backed companies more attractive than ever to tourist investors like mutual funds. We anticipate they'll continue to invest in this asset class."
Mutual funds are still nowhere close to replacing venture capital firms, particularly at the early stages, as VCs still excel at identifying billion-dollar ideas from company inception. Firms like Fidelity and Tiger Global tend to invest in late-stage companies that have already proven they have a viable business and just need extra cash to run it, according to the report.
A digital health startup that has raised $17.9 million (£13.7 million) and helps patients find medical trials online has rebranded itself from TrialReach to Antidote.
The London-based company, founded in 2009, has built a website that aims to match patients with trials, while also helping pharmaceutical companies to find patients to test new drugs on. It does this by pulling in clinical trials from multiple sources, before going on to present the information in a more accessible format.
Pablo Graiver, CEO and cofounder of Antidote, said: "TrialReach as a brand became a little bit short. We outgrew the brand.
"We’ve been evolving in the last 12 months, maybe a bit quietly. We’ve been evolving the technology, strengthening the team, and building the relationships that we have with pharma companies and research hospitals. Now we’re ready to go out and say 'hey.'"
Antidote is free for patients to use but pharmaceutical companies must pay the company a fee if it wants to use the platform to find patients for trials.
Hundreds of thousands of patients have already been enrolled onto clinical trials that they might not have otherwise found as a result of Antidote's platform, Graiver said.
Other names on the shortlist included Roura, Almond, Voyager Health, and Carbon Health.
Eze Vidra, a former venture capitalist at Google Ventures and the current CIO at Antidote, highlighted that an antidote is "something you apply in a small dose to solve a big problem."
He added: "A change in name not only represents a change for the company but it also represents a change in ambition. TrialReach is very pharma speak and technical, while Antidote is actually the cure."
The name-change is being announced at a pharmaceutical conference in Boston, Massachusetts, on Tuesday, where Graiver plans to meet with potential investors and executives of pharmaceutical companies.
Rebecca Kantar was two years into Harvard when she dropped out.
"I just felt like a lot of the same brain development was happening to me throughout my classes," Kantar recalled to Business Insider.
As with most students, Kantar had spent most of her academic life learning information and then being quizzed on it through multiple-choice tests or essays. Even when she went to Harvard, she said, she felt stuck cramming knowledge and then bubbling in letters on a sheet for a score.
"I think across the education system right now, we still have a focus on content-based learning. Can you learn more stuff about whatever domain?" Kantar told Business Insider.
"What I was more interested in was could I apply concepts that stem from understanding a domain to real-world situations? And what I found during my time at school was that there were fewer environments to bring something to life in a project-based way."
With the SAT celebrating its 90th birthday this year, Kantar believes it's time for a radical update of standardized testing — one that doesn't just reward rote memorization but one that can assess how your brain works and how you put that knowledge to use.
To do so, she started Imbellus in 2015. Today, she's announcing that the company has now raised $4 million from investors including Upfront Ventures and Thrive Capital to try to upend one of the foundations of the education system.
"Our hope is to measure how people think instead of what people know," Kantar said. "There's a better way instead of using multiple choice, and that's to take advantage of technology."
What a new SAT could be
Right now, much of what Imbellus is building is under wraps. Kantar started the company last year and is realistic about how long it will take to change a national education standard.
Imbellus' approach will be closer to showing your work on a math test than to just writing down the solution. She said the company's process would track how you solve a problem — not just whether you get the answer right.
"We've been using content as a proxy for a lot of skills that we need this century, like analytical thinking, like problem solving, and we've been doing that because our assessments haven't known how to measure anything outside of multiple choice or essays," she said.
And she's not doing it alone, as Imbellus is partnering with CRESST, the National Center for Research on Evaluation, Standards, and Student Testing. The education innovation arm is helping Imbellus craft some of its psychometric testing frameworks and is also analyzing the data.
"We hope that in the next two years we can show the world that measuring someone's process is possible and you can understand how people think," Kantar said. "It'll give us much better insights on how to place people in the right career and the right school over time."
Jobs first, SAT second
To start, Imbellus plans to tackle the entry-level job market rather than go straight to the SAT.
Instead of career aptitude or placement tests, Kantar envisions people taking Imbellus tests to guide their job search, so they'll know whether their skills are the right match for a particular employer.
It's a hard challenge: For starters, Imbellus has to build profiles for different companies, down to different roles. Certain companies will attract different skills like imagination and creativity versus analytical thinking, or they'll want a mix. It will also need to take into account that companies want a mix of employees who think in different ways.
"We're not trying to say, 'Here hire the same type A person over and over and over again,'" Kantar said.
Rather, it plans to start small to replace certain content-based tests for entry-level jobs, helping to show recruiters which skills and cognitive abilities the person has rather than how much they've memorized information about the job. The goal is to help employers to find the right fit for the right role.
If that proves successful, Kantar hopes it will trickle down to becoming the standard for fitting students to schools, too.
"The SAT and most other assessments have made the mistake of comparing everyone to an average that is no one," Kantar said. "The problem is that grading model doesn't take context into account. You don't necessarily need the same set of skills to apply for a job at Goldman Sachs as you need to be successful at the Rhode Island School of Design."
The tech startup world has faced a hard year, with bankruptcies, layoffs, and a challenging funding environment.
Exits for tech startups — that is, acquisitions or public offerings, which are the main ways startups return money to investors — are also down from last year.
According to a new report from CB Insights, the number of exits in the first half of 2016 is down 17% compared to the same period last year, although the trend is upward — up 6% between Q1 and Q2.
The decline has hit both IPOs and M&A, with 300 fewer companies bought compared to the first half of 2015, and 19 fewer IPOs.
The price tags of these companies are also small. While there have been some splashy billion dollar exits like Cruise Automation and Jasper Technologies, 53% of tech company exits were for less than $50 million — meaning companies are being bought early for talent or technology.
Here's CB Insights' full report on what the tech exit landscape has looked like so far in 2016:
See the rest of the story at Business Insider
From the winding freeway that links Silicon Valley with San Francisco, the giant Mode Media sign gracing the company's headquarters was a hard-to-miss proclamation alerting passing drivers to an internet success story with a rich, $1 billion valuation.
But last week, on the 11th floor of the gleaming building, the mood among employees was sour.
Those gathered in the office and patched in through a crackly teleconference suddenly learned that they had no more jobs, no more health insurance coverage, and no more access to the company email system. Mode Media, founded in 2003 and once known as Glam Media, was shutting down. Oh, and please hand in your laptops on the way out.
People were stunned and shocked, and the management team's final Q&A session with the troops didn't help.
Someone asked about severance, one former Mode employee recounted. John Small, the COO, simply responded: "There is no severance. There is no Cobra. There is no company."
"They didn't give us sh--," said another Mode employee.
The end of Mode, which raised over $200 million in funding and was once on track for an initial public offering, stands as one of the biggest implosions of the current tech boom and a reminder of how swiftly the good times can come to an end.
There is no severance. There is no Cobra. There is no company.
Even now, as the company's assets are being liquidated by a restructuring firm, many company insiders, including numerous executives, say they are in the dark about what is happening. The company has not filed for bankruptcy protection, and calls to HR by staffers are not being returned.
According to more than a dozen people interviewed by Business Insider, the story of Mode's demise is less of an out-of-the-blue collapse than the culmination of a long-running struggle against a changing market and bitter infighting that pitted a flashy, smooth-talking founder against increasingly wary overseas investors.
Hubert Burda Media, the German firm that poured $45 million into Mode as recently as last year, was very influential in convincing the board to shutter the company, according to multiple former Mode executives. In the months leading up to that point, though, questions about seemingly inappropriate spending by Samir Arora, cofounder and longtime CEO, plagued the company, while layoffs and management changes left the organization in disarray.
Arora started the company in 2003 with a list of accomplishments already under his belt. The India-born entrepreneur had worked at Apple in the early 1990s and founded NetObjects during the first dotcom boom, creating a seminal web development company that IBM acquired for $150 million.
The idea behind Mode Media, which first gained attention as Glam, was to create an online hub for editorial content produced by freelance bloggers at minimal cost. Glam's content was targeted at women. And Glam combined the content with an ad-serving network that reached a constellation of partner websites, allowing Glam to claim massive reach. In 2015, the company said in a press release that it had "over 400 million monthly users worldwide."
But as the market shifted to programmatic ad serving, in which online ads are bought and sold on automated exchanges, Mode's business began to suffer.
So Mode began trying to reinvent itself as a company that made its own "advertorial" content, especially videos and native ads. And Arora was leading the charge, with expensive initiatives including launching a printed restaurant guide and videos featuring famous chefs.
Mode's revenue had reached about $100 million annually by 2015, but growth had stopped and the company was losing about $10 million a year, according to one former executive.
All the former employees we spoke to described Arora as having a smooth, salesmanlike personality. He could charm a room and make you believe in whatever his vision was. A penchant for fancy suits and a seemingly lavish lifestyle left an impression on the rank-and-file as well, and rumors circulated about Arora's extravagant personal expenses and his use of company property like houses in the Hamptons and in LA.
When Arora and Burda Media began to clash over the direction of the company in 2015, Arora's lavish lifestyle became a focal point. Mode's board of directors, at Burda's urging, initiated an audit that included the expenses Arora billed to the company, according to two former executives. The audit covered things like the company houses.
"Any reasonable person would think it was unreasonable," one former exec said. "Homes in the Hamptons and LA, I don't see how you would use it for business use. It's impossible."
The audit ultimately cleared Arora of any improprieties, a person familiar with its outcome told us. But the episode underscores the atmosphere of mistrust pervading the company and the power struggle between Arora and Burda.
Even though Burda Media was a minority investor that did not technically control the company, the firm gained enough influence on the board to throw its weight around, according to several sources. In April, Arora was ousted as CEO by the board of directors — a move that many sources said was orchestrated by Burda.
In an emailed statement, Burda said that Arora left the company "by Board Resolution in April 2016." Arora declined to comment.
Marc Andreessen, the internet pioneer who created the web browser and joined Mode's board in 2011 after selling the social network Ning to the company, also left the board in March. Andreessen declined to comment.
Meet the new CEO
Jack Rotolo, a longtime Mode exec, was tapped in April to replace Arora as CEO. He had Burda's backing. But that didn't make his job any easier.
"Jack was put into a really difficult position," a former exec said. Every time the team turned around, it uncovered another problem regarding the finances and the future.
But still: "No one had any confidence in Jack's leadership ability." He wasn't right for the job, another said.
A wave of layoffs in June, in which 30 people lost their jobs, caused more turmoil.
There was barely any communication. "Senior, senior people in the company were just called into the room with HR and given a packet," a former employee said. "I didn't even see Jack." HR contractors rather than full-time people did the actual firing, the employee said.
Rotolo did not respond to requests for comment.
Despite the layoffs and several high-level departures following Rotolo's promotion, no one in leadership gave any hints that the company's future was in question.
True, a plan to file for an IPO that began in 2013 had quietly been put on the back burner. But some explained it away as a reflection of a difficult IPO market, or a view that the cost of building the financial infrastructure necessary to go public was better spent elsewhere.
Another former executive told us that the view inside the company was that the IPO was more of an attempt by Arora to get attention for the company, which was not ready to go public.
Then all of a sudden, in the third week of September, it all came crashing down.
What went wrong
"The general consensus of the employee base is that there was mismanagement of finances," said one former company executive.
But the simplest explanation in the eyes of many is that Burda had lost faith. The firm refused to invest any more money into Mode and ultimately orchestrated the shutdown, according to several insiders.
Burda said in a statement that Mode was shut down "due to its lack of economic prospects" and "drastic changes" in the US advertising market that made it "impossible" to find new investors:
"Mode Media's most serious challenge was the rapidly declining relevance of display advertising in the US. The management didn't succeed in developing further the original business model or to create a promising perspective for the company. Burda and the other investors continuously supported the company. However, the ruptures of the US advertising market were not likely to allow for an improvement of the situation."
Burda noted that Mode had been seeking new investors since fall 2015 with the help of Goldman Sachs. "The request for more capital could not be satisfied," the firm said. As a result, "the management of Mode asked for an ABC — an assignment for the benefit of creditors — in September 2016," it said, referring to an out-of-court alternative to bankruptcy in which a company's assets are sold quickly.
Mode retained Sherwood Partners, a restructuring firm based in Mountain View, California, whose website lists specialties such as ABC shutdowns that it says can be done with "less notoriety than with a bankruptcy."
But there are already questions about one of Mode's main assets: Ning, the social network founded by Andreessen, which Mode acquired for $150 million in 2011. A post on Ning's site last week said that Cyndx, a company led by Mode board member Jim McVeigh, has "entered into an agreement with Mode Media to take over the operations of Ning."
According to one person with direct knowledge of the matter, Cyndx is one of several companies that have put in bids to acquire Ning, but no deal has closed yet. It's expected to close by the end of the week.
The shutdown decision appears to have happened with almost no notice — even for senior management.
The day after the shutdown announcement, one Mode manager of an overseas office described receiving frantic emails from headquarters requesting immediate transfer of all funds and assets back to the US.
"It was the most unprofessional, unethical experience imaginable. [A] confirmed catastrophe," another exec said about the shutdown. "It's so catastrophically unethical. No one can believe it."
It's so catastrophically unethical. No one can believe it.
Bloggers who relied on Mode's ad network quickly complained on Twitter that they were unable to access their dashboards and that they were still owed significant fees for past work.
How a company that raised more than $200 million suddenly went bust is a question that many are still trying to answer. It's possible that during Mode's years of operation the company burned through a lot more than the $10 million it lost in 2015. Or that the $100 million in revenue Mode once generated has severly declined this year amid the changing ad market. The extent of the creditors, which are likely to emerge soon and to which Mode still owes money, may provide some answers.
Angelica Malin, a blogger who runs About Time Magazine, said her Mode login portal, where she could normally track things like how much revenue she was meant to receive for her work, gently mocked her with the message "Try again in 5 minutes" anytime she tried to access it.
She's not hopeful that she'll recover any money. "I don't think we'll go out chasing it. Would spend more on the lawyer than I'd make, probably," she said.
As any homeowner who has made a big move knows, setting up shop in a new city isn't easy as putting your things in boxes and driving a few hours.
Selling a home often creates a big financial burden since you're at the mercy of the housing market. Plus, the costs of broker fees, real estate taxes, and title insurance can add up to tens of thousands of dollars.
A new service called Restate hopes to help homeowners by connecting them in home exchanges across the US. The startup is building a nationwide housing community where people list their houses and apartments online and swap homes without selling them.
"Long-term home exchanges could be a better alternative to selling or renting out your home, especially if you want to come back in a few years," co-founder Petr Novikov tells Business Insider.
Homeowners can join the community for free, and if they want to move into another home listed on the site, they pay a monthly fee of $99. They can stay there for as little as month or as long as a few years (there's no maximum stay).
Novikov, who has moved over 15 times in the past four years, launched Restate's beta on September 19. He wouldn't disclose the number of users on Restate so far, but he says there are enough to start making matches.
Signing up for Restate is similar to listing a place on Airbnb. Homeowners fill out an application, which includes information about their home and where they'd like to move. The New York City-based startup then reviews the paperwork — making sure they actually own their home — and then users are free to browse through the available homes.
The site matches multiple people in a chain, since it's unlikely that two homeowners would want to swap homes for the exact same time period. For example, if someone wants to move from San Francisco to NYC, and another person wants to move from NYC to LA, the startup will find someone from LA who wants to move to NYC and do a three-way exchange. If someone's stay is shorter than the other persons', it'll find another person to sublet the home.
The site also automatically recommends homes that are close to the same value, Novikov says. If you move from a Manhattan apartment to a house in Iowa, for example, Restate will pay you a stipend for downgrading to a cheaper home. On the flip side, you can pay to upgrade to a more expensive home.
After the startup confirms the match, members move into their new homes near the beginning of the month. Guests are liable for any damages they make to they places they stay in, Novikov says.
The idea behind Restate makes sense, especially for millennials who feel unsure about diving in and buying a home. As The Atlantic notes, the number of millennials (18 to 34-year-olds) who own a home has dipped to a 30-year low, and for the first time in more than a century, young people are now more likely to live with their parents than with a spouse.
For those who do own or plan to buy a house, joining Restate could mean they don't need to be tied down in one spot. Or at the really least, buying a home might seem a little less daunting with the knowledge that it could be swapped at any time.
Alex Teichman crawled on the carpet as the dog ran around him. A camera watched them closely nearby.
On the screen of the computer, Teichman's outline was glaring red, despite him being on all fours like the dog. The pet, though, was a shining green.
It was graduation day from Stanford's StartX incubator, and Teichman and his cofounder Hendrik Dahlkamp had built a home security system home that can tell the difference between humans, a potential threat, and things like dogs running around a yard.
However, the video of Teichman versus the dog is the last public evidence of a company then-called Snitch. In early 2015, IEEE wrote the only story about what the duo was working on, complete with the video.
Since then, though, buzz has been slowly building around the "well-funded" and "first-rate" mysterious company and its newly discovered ties to major Google alums. With its focus on machine vision and their expertise in self-driving cars, speculation about the project's potential is growing.
A few recent clues discovered by Business Insider hint at what the tight-lipped startup might be working on.
The mystery of Snitch
Snitch's founding team is two guys with brilliant minds and backgrounds to match, a pair that many Silicon Valley investors would be delighted to throw money at.
Teichman's mentor was Sebastian Thrun, the "father of the self-driving car" who founded Google X. At Stanford, Teichman had worked in Thrun's lab and was the perception lead on Stanford's self-driving car. His summers were spent interning at famed robotics research lab Willow Garage.
Years before, Teichman had suffered from a nagging worry that his house was going to get burglarized, according to a story in IEEE. He had been receiving random phone calls, and there had been a notice of an uptick of crime in the neighborhood. So he rigged up his own security camera and loaded it with the self-driving technology that he had been working on. He wanted to be able to tell the difference between a tree branch in the wind or a burglar entering the backyard. But nothing came of it since his house wasn't robbed.
At Stanford, Teichman met his co-founder, Dahlkamp, who also specialized in seeing the world in different ways. He had cofounded the technology behind Google Street View and also went to Stanford to study under Thrun and work on its self-driving car.
The two were at a party together when Dahlkamp brought up the old security system Teichman had built. Only then did Teichman realize it might form the basis of a company.
In October 2014, they incorporated the business. Months later, they graduated from the Stanford StartX labs. And then they all but disappeared.
Business Insider has found a few clues, however.
In November 2015, the pair's mentor, Thrun, tried to find some new talent for the startup, which he described as "well-funded."
"I have an amazing job opportunity in Silicon Valley. A small, first-rate, well-funded team is seeking to hire an RGBD perception expert to help build the 'eyes of the smart home'," Thrun wrote in a robotics forum. (Interested applicants had to e-mail Edwin Jarvis, a cheeky nod to the AI butler from the "Iron Man" series.)
Also, at some point Teichman posted a plea on 99Designs, a website for freelance logo design, looking for an image to go with the name at the time, Snitch: "I'm building an intelligent home security system that uses a totally new kind of camera and can understand what it's seeing, rather than just detecting that something changed," Teichman wrote. "It's super cool but I can't draw for s--. Help!"
The winning design, a grey-and-blue camera, can be found on two websites: Kortschak Investments and Playground Global.
Playground Global is run by Andy Rubin, the creator of the Android operating system who left Google in October 2014 to start a hardware incubator. Turns out that Dahlkamp and Teichman have been incubating the company in Rubin's Playground Global over the last year, according to a job posting from their recruiter Doreen Xia on a computer vision forum.
From Snitch to Lighthouse
Although Playground is a hardware incubator, according to new trademark filings, the young company is now more concerned with software for security cameras — and it has a new name: Lighthouse.
The trademark covers computer software for a range of tasks, from viewing and analyzing video to operating, managing, and monitoring security systems. The trademark covers not only the computer software but also "software as a service", or a licensing model that would let people subscribe to using the software over time.
Today, Lighthouse's website only teases something "Coming soon."
The company declined to talk to Business Insider. Andy Rubin, Playground Global, and Sebastian Thrun didn't respond to request for comment.
Still, venture capitalists are buzzing about it, wondering if it could dethrone Google's Nest in the camera market. Since it's not making its own camera, unlike Nest which acquired Dropcam, it will have a harder time getting its software in the hands of people, one investor speculated.
Others are excited to see the technology behind self-driving cars be applied to other areas beyond the much-hyped automotive space. Lighthouse might be the first breakout company to do it.
Millennials may call themselves the most entrepreneurial generation, but the data doesn't seem to back that claim up.
That's according to a new nationwide study by professional services firm EY and the Economic Innovation Group. They polled 1,200 millennials aged 18 to 34, asking them questions ranging from whether they're worried about repaying student loans to how government interference affects business.
But the most surprising aspect of the poll was how millennials view startups.
According to the study, 72% of millennials think startups and entrepreneurship "are essential for new innovation and jobs in our economy," and 78% think working for a startup is a signal of success.
The only problem? Just 22% of millennials would start their own company.
The majority of those surveyed said they'd rather stay at one company and work their way up. Only 25% said they plan to move from job to job, which runs pretty contrary to the popular trope that millennials are job-hoppers who only stay at a company for two years, maximum.
When you break it down by gender, both white women and white men are the most hesitant about starting their own business, while black women are the most entrepreneurial: 39% said starting their own company is the best way to advance their careers.
Barriers to entry
So what's holding back all these young people from starting their own ventures? Money.
More than 40% of those surveyed said access to capital was the thing hindering them from starting a company. For women and minorities, that number was even higher: 45% of women, 50% of Hispanics, and 48% of blacks said a lack of financial means was holding them back.
Money worries aren't all that surprising if you consider the plight of the millennial generation. Not only are women and minorities less likely to receive funding for their startups, but women in technology fields are still massively underpaid. Millennials have the highest amount of student debt, they're not making as much annually as previous generations, and they're more likely to be unemployed than Gen Xers ven though they're more educated.
So it's not much of a surprise that most young adults don't feel they can afford to take the financial risk of starting their own company. But if millennials aren't joining the startup world, that could be troubling for the future of innovation — and the economy as a whole.
When it comes to startup founders, venture capitalist Jeff Jordan is looking for one quality in particular.
Airbnb founder and CEO Brian Chesky has it. Ben Silbermann, the founder and CEO of Pinterest, has it, too.
And if a startup founder doesn't have it, it's harder to get funding, attract employees, or get attention from the press, Jordan says.
So what is this mythical quality? Storytelling.
"Every great founder can really tell a great story," Jordan, the former CEO of OpenTable who's now a general partner at Andreessen Horowitz, told Business Insider. "It’s one of the key things in a founder, that you can convince people to believe."
Jordan describes Chesky as being "like P.T. Barnum" in his ability to tell the story of his company with emotional resonance.
"I’ve seen him get his entire company laughing and crying within five minutes," Jordan said. "Ben Silbermann has a very different style at Pinterest, but when he tells the story of what Pinterest is, it's very quiet and very unassuming. He did it to our LPs and they’re all leaning forward, trying to hear more."
While you're waiting to buy a new electric car that's basically a computer on wheels, a new startup is trying to make smart, well-designed products that will put a little bit of technology into your existing car.
Pearl is the name of the startup, and RearVision is its first product. It’s a backup camera and alert system that’s easy to install. It’s basically a license plate frame with two cameras.
Those cameras sync to your phone, either through Bluetooth or Wi-Fi. So start the Pearl app on your phone, and you'll see what's behind you as you back up your car.
Pearl’s CEO, Bryson Gardner, was one of the key people behind several Apple products, including the iPod Nano, and his team at Pearl has over 50 former Apple employees. He tells me the rear-view camera is only the first of a set of computerized accessories for your car that the company is currently building.
We took it for a spin this past weekend. So is it worth $500?
The PearlRearvision is a set of HD cameras built into a license plate holder. Here's what it looks like when it's installed.
The Pearl RearVision doesn’t just include the smart license plate holder. It also comes with a phone mount, installation screwdriver, and magnetic stickers for your phone.
One of the nicest touches on the Pearl RearVision is that it’s solar-powered. A set of solar panels run along the bottom edge of the license plate holder, so the part you install on your car shouldn’t need any extra power. But if it does run out of juice, there’s a built-in USB cord too.
See the rest of the story at Business Insider
Squarespace is one of the most prominent New York tech startups, and it recently moved into an office that wouldn't look out of place among its peers in California.
The new office, like many of the best New York offices, is based in a historic building. Squarespace renovated the Maltz Building in New York's Soho neighborhood to reflect its own branding, and moved in over 300 employees earlier this year.
Squarespace has raised over $78 million from investors including Accel Partners, General Atlantic, and Index Ventures. The company develops tools for making websites.
Squarespace occupies the top three floors of its new building. Take a look!
The offices have a very "Mad Men" vibe with a strong modern design influence.
The floors are polished concrete.
Even the entrance to the building has been redesigned for Squarespace.
See the rest of the story at Business Insider
Since my first job at a mobile-media startup, way back in the ancient times before the app store existed, I've had a hand in hiring developers.
A few years later, when I started managing development teams, it fell completely on my shoulders. I've even had to rebuild a team which was later part of a high-profile (and high-priced) Amazon acquisition.
This gave me a pretty solid clue that my system for hiring developers, or really any engineering talent, was great at picking up some of the best talent in the world.
Beyond the Amazon acquisition validating this concept, I've spent over $1 million on developers in the last few years to prove this process out. Now, it is a core premise of how Iadvise startups to take their development and engineering team to the next level.
It goes deeper than "hire slowly, fire quickly." That's absolutely true, but it doesn't tell you how to effectively attract and hire world-class developers. If you really know how to hire a rockstar, this particular maxim reads more like "hire carefully, fire if you've somehow screwed the process up."
This is how I hire world-class developers:
Treat your job description like a sales letter
Be as specific as possible in what you are looking for, what the short- and long-term fit is, what skills you want, and what skills you don't want. This will help you get more relevant resumes in your inbox.
Since your job description describes exactly what you want and what you don't, you can now review resumes in record time. If you aren't getting a steady stream of candidates that fit your job description, you should be working with a recruiter.
Build rapport (and make sure candidates aren't lying)
This means you have to jump on the phone with them for a little "getting to know each other" chat and a phone screen.
Do a quick online search for relevant questions to ask to make sure that applicants aren't totally BSing you on their resumes. Make sure you have a list of what you want to hear and what you don't want to hear.
And always remember: This is a two-way street. You are looking to choose them, and they are looking to choose you.
Watch the machine work
Now you get to see some actual work. If you're hiring a contractor, pay for a small project. If you're looking for a full-time developer, this is part of the pipeline, and they have to pass it to get through to the interview.
The project can be irrelevant to your company, and it should be painfully simple to do — nothing more than an hour or so of work. I always make mine ambiguous in what the end result should be, so I can see if what they call "done" matches what I call "done."
Put a time limit on it and be firm within reason to their other obligations outside of work. Remember, this is only an hour of their time.
Do NOT skip this step.
I can't stress this enough. This is where you and your team can see inside a candidate's thought process, see their best practices and standards, and see how they solve open-ended problems.
Some developers will resent you for this, and you won't be hiring them. In today's competitive marketplace, it's an absolute necessity.
I've actually had a developer actually tell me that he doesn't trust a company that skips a test project for new hires!
Guess what? He's a complete rockstar, and I trust him.
Write up relevant whiteboard questions and ask the developer to solve them on the fly in person or via video chat. If you aren't technically inclined, have your tech friends (or Google) list out some questions, acceptable answers, and red flags.
The goal here is to see how they think on the spot and get a good sense of strengths and weaknesses, not to trick them into solving brainteasers or super specific problems.
Do they understand the languages that you're using? Do they have a clue about security? Can they explain their ideas and thinking? These are important skills for any technical person.
Get down to it
It's finally go time for the interview. This can be in person or via video chat, depending on the circumstances. This should be immediately after the whiteboard session to keep the candidate engaged and into what you're doing. At the end of this interview, you will be able to get a solid impression of him or her and sell the position after you know you like them.
Close the deal or walk away
Have a debrief with everyone who interviewed the developer. If you're the lone wolf interviewing, get a mentor, consultant, or coach to help you out. The debrief should take place immediately after the interviewing ends, so you can decide and make an offer or move on to the next developer within a few minutes of the first one leaving.
At the end of this process, you can have an offer out to a candidate within fifteen minutes of them leaving the interview. You'll know what they are good at, what they're bad at, how they communicate, and how they solve problems in real time.
This will give you full confidence when you make the hire. Additionally, by the end of the interview process, the developer is super invested in your company and is truly excited to play a part in it.