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- 03/25/15--04:00: _The Facebook engine...
- 03/25/15--12:24: _This 27-year-old fa...
- 03/26/15--00:00: _IT'S OFFICIAL: Grey...
- 03/26/15--16:12: _Magic just showed i...
- 03/27/15--10:35: _Microsoft buys, shu...
- 03/29/15--05:59: _39 of the coolest s...
- 03/30/15--08:12: _We checked out Vict...
- 03/30/15--11:39: _Why one VC firm is ...
- 03/31/15--06:00: _These 16 startups a...
- 03/31/15--11:20: _Fascinating message...
- 03/31/15--13:33: _This app tells star...
- 04/01/15--13:44: _Oscar is a New York...
- 04/01/15--15:12: _They can't all be u...
- 04/02/15--04:30: _Venture firm Lux ju...
- 04/02/15--05:36: _College kids seem t...
- 04/02/15--06:00: _A new startup calle...
- 04/02/15--06:27: _How trusting her gu...
- 04/02/15--07:12: _The truth about lif...
- 04/02/15--08:26: _A startup that want...
- 04/02/15--17:03: _OnLive, the first c...
- 03/26/15--00:00: IT'S OFFICIAL: Greylock led Meerkat's $14 million round
- 03/27/15--10:35: Microsoft buys, shuts down a tiny startup
- 03/29/15--05:59: 39 of the coolest startups founded by women
- 03/31/15--13:33: This app tells startup founders where they should live
Back in 2008, Facebook released Cassandra, a free new technology it had come up with for searching huge amounts of data (specifically, user inboxes).
Cassandra would go on to take the world by storm, with everybody from Apple to Wikimedia using it to power their data-heavy web services.
Today, the man who invented Cassandra at Facebook, Avinash Lakshman, reveals his new startup: A storage company called Hedvig, which has raised $12.5 million in search of a repeat performance as it works to help companies hold the huge amounts of data they generate.
Before Facebook, Lakshman worked at Amazon Web Services, where he co-invented the Amazon DynamoDB data-crunching product.
He says he had a fine career ahead of him at Facebook. But working on Cassandra gave him the glimmer of some new ideas he knew he had to pursue.
"At Facebook, everything was going good for me, but I knew what it was I wanted to do," Lakshman says.
The basic problem Cassandra solved is that when you have a lot of data sitting on a lot of servers, as Facebook does, you end up with a house of cards. A single server going down can collapse the whole stack.
Cassandra is software that lets you store data distributed across many systems, such that just one individual server going down (as they inevitably do) has only the barest of impacts on the whole application.
That's great, as far as it goes, and it's why it has so many fans. But the actual hard drives in those servers just aren't as flexible or as fault-tolerant. It's a problem that's especially prevalent when companies like, yes, Facebook have to add tons of hard drives all the time just to hold the ever-increasing amounts of stuff we generate and store.
"Modern applications are changing the game about how data is generated,"Lakshman says.
Right now, if you have a data center with lots of servers with lots of data, adding hard drives is a pain in the behind. Because of these complex systems, it's not as simple as plug-and-play. It takes a lot of planning and delicate architecturing, like playing Jenga with a stranger's pictures of cats.
This is why companies traditionally only update their storage every three to five years. Which is great, except when the you're doubling the amount of data you need every three months.
Which brings us to the specific problem Hedvig aims to solve.
Hedvig sells what you call "software-defined storage," where it gives a system for adding storage to a system without any kind of headache. Install their software on top of your storage, and it applies the same kind of fault-tolerant thinking behind Cassandra to the storage itself. Hardware from any manufacturer, not just the big guys, will immediately get added to the pool of available storage.
It's something that sounds like it should have been simple all along, but it's actually pretty hard. Lakshman actually got certified in some of those old-school storage platforms before founding Hedvig just to understand the issues.
"In order to understand the future, you have to understand the past," Lakshman says.
"Hedvig," incidentally, was chosen as the name for the company because it has nothing at all to do with what it does — something Lakshman apparently was told is important before founding the company. It stands for "Hyperscale Elastic Distributed Virtual Integral Granular," all qualities Lakshman says the product was designed around.
The funding round was raised by Atlantic Bridge Capital, with participation from True Ventures and Redpoint Ventures, at an undisclosed valuation.
Walking into ABC’s “Shark Tank” last September, Lumi CEO Jesse Genet asked for $250,000 for 5% of her company.
Lumi was a 3-year old startup selling photo printing kits online. It would allow users to print any type of logos or graphics — using natural sunlight — on things like a t-shirt, a wall, or even a car. It only had about $1 million in annual sales, but Genet valued her company at $5 million.
The “Sharks,” or the show’s panel of investors, weren’t too nice about it.
“I like you, but I don’t like the valuation — it’s a very rich valuation,” Laurie Greiner, the star QVC host told her.
Kevin O’Leary, the sharp-tongued dealmaker, was more direct: “That’s 50 times your free cash flow — It’s ridiculous.”
Under O’Leary’s estimation, Lumi’s $1 million sales would only translate to about $100,000 in after-tax profit, and he was only willing to value the company at $500,000. The sharks instead made a loan offer at a much lower valuation.
Genet left without a deal.
“[The comments] were dicey, but I can handle that,” Genet told Business Insider. “[Shark Tank] helped us realize what was really big about our business and what was not scalable.”
But that didn’t stop her from seeking other fund-raising opportunities. Shortly after recording the show (her episode aired in February), Genet applied for Y Combinator, the preeminent startup incubator in Silicon Valley.
YC liked her story: She once had to track down the person who owned the proprietary technology behind her product for two years to buy it out for $50,000, and had raised over $270,000 on Kickstarter to get it off the ground. Lumi was already selling in over 1,500 retailers like Urban Outfitters and Michael’s at that point.
So in December, Lumi joined YC, and during the three months there, it expanded its product line, revamped its website, and grew its overall revenue. Genet says it now has $2.5 million in sales, with customers from all 50 states and 20 countries worldwide. On Tuesday, Genet was on stage, presenting her product in front of thousands of potential investors at YC’s biannual Demo Day.
“What you just watched at our new YC presentation is a whole new set of products that we didn’t show the sharks,” Genet tells us.
Lumi is small compared to the outsized billion-dollar valuations of recent startups in the valley. But there are always one or two YC alums every year that go on to become the next big thing, such as Dropbox or Airbnb, and Lumi may well get there one day. But Genet thinks it’s still a long-term process.
“One key thing is not to rush your own business,” Genet says. “I’ve been working on these ideas since high school. Even if you’re not making a ton of money, that experience of just living the company day-in and day-out, getting that feedback and experience, is something you can never replace. You’ll have an authentic story to tell and a much better success.”
Here's Lumi on "Shark Tank":
Live video streaming app Meerkat has scored an investment from Greylock Partners, the company confirmed.
Business Insider and The Information had previously reported that Greylock was talking to the firm, and TechCrunch reported that the round was around $12 million, with Greylock putting in around $10 million, but founder Ben Rubin said the amount was actually $14 million.
We had also heard that the round valued Meerkat, which is only a few weeks old, at $40 million. Meerkat is a spinoff of Life On Air, previously known as Yevvo.
Meerkat offers users an easy way to stream live video from a phone to followers. It has grown quickly, garnering more than 120,000 users in its first two weeks after debuting on Product Hunt. We heard that the founders were "hounded" by venture capitalists at the recent South by Southwest trade show in Austin, Texas, and that the round is oversubscribed.
Twitter recently bought a Meerkat competitor called Periscope, and last week disabled a feature that let Twitter users automatically turn their followers into Meerkat followers. But Meerkat founder Ben Rubin told us he wasn't worried about Twitter's plans.
Greylock's Josh Elman wrote a blog post explaining why they're excited about Meerkat:
For viewers, we think this is going to provide an amazing alternative to other kinds of engagement and entertainment. Instead of reading asynchronous messages, you can jump in live, with friends, to view the world through someone else’s eyes and talk and express yourself together. For artists and creators, we think this will inspire a new way of engaging with their fans and enable them to create and earn significant new value for their content along the way too.
The company has posted a mysterious countdown clock set to end at 12 noon ET. We expect it to be a live Meerkat broadcast of the Rubin and Greylock's Josh Elman discussing the round.
Magic — the service that lets you text a number and get "anything you want as long as it's not illegal" — is raising $12 million from Sequoia Capital at a $40 million valuation, just a few days after graduating from the Y Combinator startup accelerator program, reports TechCrunch.
If Sequoia is really investing in Magic at that insanely high valuation, it's banking that customers want simplicity more than anything.
And the way Magic works is very simple: Text the official number with whatever you want, and they get it to you. Maybe your order is filled by Seamless or Postmates or another delivery company entirely, but you don't care. They give you a price (plus a markup), and if you agree, they deliver what you ordered, from pizzas to groceries to party supplies to liquor, like magic (get it).
Just don't order a tiger. It's a thing.
Magic experienced a huge surge of popularity when it first debuted back in February. It was the weekend project of a company called Bettir, which was enrolled in Y Combinator, which mentors startups as they develop their business in exchange for some equity.
But after Magic caught fire out of nowhere, Bettir decided the service would be a better business, and changed courses partway through the Y Combinator startup program.
Nothing Magic does is new. But it's the simplest way to order things that anybody has come up with, and just this week, Facebook explained how it thought chat is the future interface for businesses.
"Microsoft is excited to welcome the talented team from LiveLoop to help build great collaboration across Office applications, as part of our strategy and vision to reinvent productivity," a Microsoft spokesperson said in an email.
LiveLoop's first product let you share a Microsoft PowerPoint presentation on the web with a simple URL, without the person on the other end needing to download any software or use a videoconferencing app like GoToMeeting.
As ZDNet notes, it would make a nice addition to the stuff Microsoft is already doing with teleconferencing, especially with its giant Surface Hub touchscreen conference room computers.
Existing LiveLoop users will have until April 24th to get all of their stuff off of LiveLoop before it shuts down permanently, it said. At the time of writing, the LiveLoop website was down, perhaps due to a sudden rush of interest in the company in the wake of the acquisition.
LiveLoop was funded by New Enterprise Associates and Columbus Nova Technology Partners, but the company never reported how much money it raised. Terms of the acquisition were not announced, although Microsoft did confirm the deal to Foley. (We've reached out to Microsoft to ask for comment.)
LiveLoop joins startups like Acompli and Sunrise in the roster of productivity-boosting startups snapped up my Microsoft. Acompli has become the basis of the lauded Microsoft Outlook for iOS app. We'll have to wait and see what happens to LiveLoop.
Women may be underrepresented throughout the tech sector, but they're still building some incredible startups, apps, and products.
The folks over at Product Hunt have created and curated a collection of the best startups and products founded by inspiring women. VCs, entrepreneurs, and Product Hunt members have all weighed in on their favorites.
From uBeam's innovative wireless charging technology to Hopscotch's program for teaching kids how to code, the products women are making are changing the world.
Rachel Willmer had just bought an e-reader before going on vacation in 2008, but she quickly stumbled across some problems while trying to load books onto the reader. Some stores didn't carry the right format for her e-reader; some were too expensive; and others wouldn't sell her a book because she was in a different country.
Luzme solves e-book woes by letting you sign up for the books you want from the stores you want, and then emailing you when the price drops on books you want. Luzme hasn't raised any funding money yet.
Hitlist lets you build wishlists of places you want to travel to. When there are fare deals for those places, Hitlist will send you an alert so you can buy tickets cheap. There's a social aspect to Hotlist too: you connect via Facebook and can see where your friends are planning trips.
Founded by Gillian Morris and built by her startup TripCommon, Hitlist competes against apps like Kayak and HotelTonight.
Whether you're a gym rat with an everyday regimen or a couch potato looking to get some exercise, Fittr wants to help you reach your goals. You tell Fittr how in shape you are and enter tags like "apartment" or "lifting" to let the app know how much equipment you're working with. Fittr is available in the App Store — you'll get a free 5-day trial, but you'll have to pay $11.99 for the full version of the app.
Fittr raised an undisclosed seed round of funding in August from nonprofit Tampa Bay WaVE.
See the rest of the story at Business Insider
Victor, an on-demand service for hiring private jets, just raised about £5.5 million ($8 million) in investment funding, expanded into the US, and launched a mobile app on Apple's iOS mobile platform.
The UK startup works much like Uber, but instead of booking a car, people pick a luxury airplane to fly around the world — in just a few clicks.
It even has a service for dogs, Pets on Jets, geared toward people who don't like the idea of their Rover riding in the baggage hold of a commercial jet.
In the app, the first option is to charter one of its 7,000 registered private jets. You do this by choosing a time, place, and aircraft size, then paying. Types of jets include the "Head of State," the "Mid-size" (good for longer European trips), and the "Very Light Jet," which might take you from London to Berlin, for instance.
Prices vary depending on time, place, and the size of each airplane. The cheapest fare we found was a flight to France for £450 ($666) per head, if you have seven friends who fancy a bit of impulse wine tasting. Victor is supposed to be cheaper and more "transparent" because it removes additional fees incurred through agencies and member clubs. Victor partners directly with aviation suppliers, so there is no need for brokers who might hike up costs through commission, CEO and founder Clive Jackson tells me.
"We make it cheaper by removing the broker," Jackson says. "It's a really simple process — it's quick, easy, and there's just one fee. You can click a button and be flying instantly." He says the market was "inefficient and unclear" with brokers. Instead, Victor provides "full transparency into the aircraft, crew, and pricing system.
"Traditionally, booking a private jet is an ineffective process with consumers at the mercy of brokers who often considerably mark up the cost due to the lack of regulation in the market," Jackson says.
Once signed up to the service, users can get instant quotes, price comparisons, and click-to-pay functions. They can see photos of what they're buying, complete with aircraft details.
"People who fly this way want the best," Jackson says. "They want to see they're getting the newest, most exclusive plane."
Through the app, trips can be added to your smartphone calendar, and travel information is sent to your email inbox and Apple Passbook. You just have to turn up at the chosen airport.
Despite its ease, Victor is designed as a luxurious and "bespoke" service. Customers are given a concierge to handle bookings and make sure every need is met. "They act as a PA would," Jackson notes. "But instead of having a PA call companies and sort everything out, it's all done through the app."
Victor's Pets on Jets program allows dogs to fly with their owners. And Jackson even hinted that there might be a partnership with Uber in the future, which would seal a door-to-door process.
FTSE 100 executives and music-industry professionals are the typical target market — people who need to travel a lot. There are now 14,888 members, many of whom are shareholders — these are the people who funded the 2015 expansion into the US and Victor's app development. Elton John is one of them, I'm told.
There's also an "Empty Legs" part of the site. This uses a Victor-built algorithm to find and compile all the spare private jets sitting at airports. These might be owned by private companies but not booked, so customers can do so through Victor.
Here are some prices for flights out of London at the time of writing — just £3,327 ($4,931) to Bordeaux, France. Yes, this is much more expensive than EasyJet, but split between seven people it's relatively affordable, at a mere £475 ($704) per person. To book through a traditional service would be much pricier, of course. The cheapest deal I found was just £990 ($1,467) — from London Luton to Birmingham International.
Jackson, based in the London office, also tells me the app and US expansion are natural progressions for the business. "We've been really successful in Europe and have lots of great investors. The US market is huge for aviation, so it certainly feels right to launch there."
Victor has opened a branch in California and is hiring tech engineers all the time. Jackson says the US is the largest region for private jets and accounts for 49.7% of the global market; Europe has a 20.8% share.
"Expanding our operations to the US ensures we have presence in the most dominant market and are able to be closer to our customers in the region," he says. "Our shareholders are also some of Victor's most frequent fliers, which is evidence that our customers value and trust our business model."
Look across Seattle’s startup landscape, and you’ll see a commonality.
Like the tree it takes its name from, Madrona Venture Group’s roots are everywhere.
Partners teach entrepreneurial classes at the University of Washington. Organizations such as Techstars and UP Global rely on its support. And countless entrepreneurs have walked through the doors of the firm’s offices at 999 3rd Avenue hoping to add fuel and muscle to their startups.
Founded 20 years ago as a network of influential angel investors, including co-founder Tom Alberg who made an early bet on Amazon.com, Madrona has morphed into the region’s preeminent venture capital firm. As many Seattle venture firms have faded away — OVP Venture Partners, Fluke Venture Partners, Frazier Technology Ventures — Madrona’s might has metastasized.
And its importance continues to grow, perhaps to the point now where it is almost too critical.
If Sequoia or Kleiner Perkins disappeared from Silicon Valley, the money train would likely continue unabated. Other firms — whether Accel, Greylock or Andreessen Horowitz — would pick up the slack. But that’s not necessarily the case in Seattle.
When it comes to early-stage venture capital, Seattle is almost the equivalent of a one-sports-team town. And that’s not really a good thing.
Ask yourself: What would happen to Seattle’s startup scene if Madrona disappeared?
Madrona’s outsized impact can be seen in recent data compiled through Pitchbook. In 2014, Madrona invested about $100 million in 35 Pacific Northwest companies — roughly 10 percent of the entire haul.
While that’s a significant percentage, the numbers are even more staggering when you consider the multiplier effect. For each dollar invested by Madrona in early-stage companies in the Northwest, another 3.5 dollars flow to those portfolio companies. In 2014, Madrona and its syndicate partners — typically larger Silicon Valley venture firms — sunk $463 million into the region. That means Madrona-backed companies represented about 40 percent of all dollars invested in the region last year.
That’s impressive, but also a little scary when you think about it.
And it begs the question: Could Seattle’s startup community have too many eggs in one basket?
Partners at Madrona even recognize this issue, repeatedly noting that they’d like to see more home-grown capital flowing in the Northwest. That would mean more competition for Madrona.
But as in all industries — including the venture business — competition is good. It raises the game of everyone.
Madrona’s Matt McIlwain admits that they can’t invest in as many startups as the region needs, noting that Seattle would benefit if more people rolled up their sleeves to build companies. He also asked the question himself whether Madrona has too much concentration.
“We’d be delighted to see more total capital going into the region,” said McIlwain. “We’d be completely comfortable if our capital was a smaller percentage. I don’t know what the right number is.”
As McIlwain sees it, the region needs more “company builders” — people who will not only provide capital but the expertise to make sure small businesses grow into big ones.
“The capital is the tail wagging the dog here,” said McIlwain, adding that many venture capitalists provide operational expertise and business contacts that go well beyond the money. “That’s more of the thing that we need.”
Having more indigenous capital and company builders would help entrepreneurs in the Seattle area, allowing more timely resources if an entrepreneur encountered business problems or strategic questions, McIlwain said.
Seattle venture capitalist Bill Bryant, a partner at DFJ, said the region certainly benefits from having Madrona investing in so many early-stage startup companies.
Bryant pointed specifically to companies such as Apptio, ExtraHop and Redfin. But Bryant also noted the importance of having a mix of investors deploying capital.
After all, for every 100 entrepreneurs that Madrona meets, it ends up backing just one.
“Like any ecosystem, the region requires diversity in its investor base to thrive: investors with different strategies and stage focus, interested in different sectors, technologies and markets, as well as enough strong investors to syndicate locally as happens in the Bay Area, Boston and now NYC,” said Bryant. “There are lessons to be learned from Austin’s dependence on the now defunct Austin Ventures, Denver’s reliance on the defunct Centennial Ventures or Vancouver which was dominated by Ventures West until they too went away.”
Madrona isn’t likely going away anytime soon. It raised a $300 million fund — the firm’s largest — in 2012.
The firm also added more heft earlier this month when it announced that three of the heaviest hitters in Seattle technology circles joined as strategic partners: F5 Networks CEO John McAdam; Concur CEO Steve Singh; and Isilon co-founder Sujal Patel.
Those leading tech founders and CEOs will help Madrona find new deals, and help existing portfolio companies grow.
Building the next generation of big companies in the region is something that everyone should care about. After all, Seattle needs a deep bench of startup companies that are turning into the next Tableaus, Zillows, F5s or Concurs. This regeneration of the ecosystem is something that drives a tech hubs forward. McIlwain, for one, said he’d welcome “roll up their sleeves teams” to build new early-stage companies in the region.
“We are not entrepreneurially constrained,” says McIlwain. “We are capital and company-builder constrained.”
Last week, news broke that Slack was raising a new round of investment that would value the young company at a jaw-dropping $2.76 billion.
That would make Slack the second most valuable enterprise startup in the world, according to valuation expert PitchBook. (By "enterprise startup" we mean a company that primarily sells tech to businesses as opposed to consumers.)
We asked PitchBook to send us a full list of the most valuable enterprise startups in the world, along with details from public filings on the investments.
No. 16: Okta is worth $787 million
Current valuation: $786.71 million
Location: San Francisco
What it does: Okta offers a cloud service that helps companies manage employee passwords/logins to other cloud services.
Total amount raised: $155 million
Last raise: The company raised $75 million, at $11.86/share, in a Series E funding led by Sequoia Capital on June 9, 2014.
Valuation before last round of funding: $711.71 million.
Other major investors: Andreessen Horowitz, Greylock Partners, Khosla Ventures, Janus Capital Group and Altimeter Capital also participated.
No. 15: MixPanel is worth $853 million
Current valuation: $853.43 million
Location: San Francisco
What it does: Mixpanel offers an analytics service that helps companies measure and analyze the performance of mobile and other business apps.
Total amount raised: $77 Million
Last raise: The company raised $65 million of Series B venture funding at 37.54/share from Andreessen Horowitz on December 18, 2014.
Valuation before last round of funding: $788.43 million
Major investors: Altimeter Capital Management, Andreessen Horowitz (Marc Andreessen), Greylock Partners (Aneel Bhusri), Janus Capital Group, Khosla Ventures, Sequoia Capital (Patrick Grady)
No. 14: Qualtrics is worth $1 billion
Current valuation: $1 billion (estimated)
Location: Provo, Utah
What it does: A cloud service for performing sophisticated employee and customer feedback surveys.
Total amount raised: $220 million
Last raise: The company raised $150 million of Series B venture funding from lead investor Insight Venture Partners on September 24, 2014. Accel Partners and Sequoia Capital also participated.
Valuation before last round of funding: $850 million
Other major investors: Accel Partners (Ryan Sweeney), Sequoia Capital (Bryan Schreier), Insight Venture Partners (Jeffrey Lieberman).
See the rest of the story at Business Insider
I recently came across an early forum post in which Jan Koum was promoting his new iPhone messaging app, something called WhatsApp. That small project, of course, become the second largest tech acquisition of all time. So I decided to compile other early posts by the people who founded today’s biggest tech companies, who couldn’t have known where their early efforts would take them. Or, at the very least, they were more concerned with things like Unix developers, user-agent headers, and whether anyone would bid in an online auction for Marky Mark underwear.
When Linus Torvalds posted to this forum in 1991, he was asking for suggestions on the features most people would want to see in an operating system. It’s “just a hobby, won’t be big and professional like GNU,” the 21-year-old wrote. Linux is now the most popular free desktop operating system, and powers more than one-third of public servers.
When developing Google, Larry Page posted a Java question about setting the user-agent header for his Web crawler. Let me Google the answer for you, Larry. At the time, in 1996, two years before Google launched, Page was a 22-year-old Ph.D. student working on his research project. By the way, it seems like he ditched Java and used Python instead.
In 1994, Jeff Bezos was looking for Unix developers. They needed to be able to build large and complex systems in “1/3 of the time that most competent people think possible,” he wrote the year he founded Amazon. He’s now worth $34.5 billion, and Amazon is now the largest online retailer in the world.
In 1995, Pierre Omidyar advertised his new auctioning service on AuctionWeb. One of the items available for bidders: Marky Mark underwear. He’s now worth $8 billion, and eBay is the world’s largest online auction site.
In 2007 Drew Houston introduced his storage service, funded through Y Combinator. His pitch: Throw away your USB drive! He’s now worth $1.3 billion.
In 2009, Jan Koum promoted his free iPhone app. He hated it when people couldn’t reach him when he was traveling. Five years later, Facebook bought WhatsApp for $19 billion.
Markus Persson posted the alpha version of Minecraft in 2009, and it received great responses from indie gamers. Five years later, Microsoft bought Minecraft for $2.5 billion. The same day, Persson left the company to keep his sanity.
Palmer Luckey posted in 2012 about Oculus Rift and his plan to start the project on Kickstarter. He was 19 years old. Two years later, Facebook bought Oculus Rift for $2 billion in order to conquer the world.
A new app called Teleport is trying to tell startup people the best places across the world for them to set up shop.
The problem solved by Teleport is simple, says co-founder and CEO Sten Tamkivi, who was previously an early executive hire at Skype and most recently an entreprenuer in residence at prominent Silicon Valley venture capital firm Andreessen Horowitz.
"It used to be that you had to move to a place if you want a job in that place," Tamkivi says.
Now, since technology like Slack, GoToMeeting, and Skype makes it so easy to work anywhere, and since the modern startup lifestyle requires so much travel to customers across the country and the globe, you don't have to physically be located anywhere you don't want to be.
But figuring out the right city to start up a business takes a combination of factors. Where's your family based? What are your hobbies and interests? Where are your ideal customers? What are the costs of living in a new city? How friendly are local regulations to the business you're trying to build?
"Those decisions are increasingly complicated," Tamkivi says.
"Top 50 Cities" lists in travel and business magazines only take you so far, since they don't take into account your particular circumstances.
It's especially important if you're trying to build a business without a huge amount of cash to start with — Tamkivi says that here in the San Francisco Bay Area, where Teleport is based, a 30-minute change of commute can save you $25,000 a year.
So what Teleport does is crunch all kinds of census data, salary data, quality-of-life survey data, studies on entrepreneur-friendliness , and as much other stuff as it can get its hands on from all 100-plus target cities, and put it all behind a slick iOS and Android app that lets the user choose what's important for them.
That includes weather data, quality of Internet, and travel times to other cities you need to frequent, as well as the obvious stuff.It even pulls in data from places like Airbnb to tell you the cost of spending, say, two months a year in another city for the occassional visit with investors.
"It's a marketplace between cities and talent," Tamkivi says.
While it's optimized for entrepreneur folks who want to find places where rent is cheap and affordable talent is plentiful (unlike San Francsico), it goes the other way, too: Developers and other tech industry types can find the centers where people are hiring at the salaries they want, across the globe.
Local governments in places like Estonia and Finland are even working with Teleport to hype themselves up as progressive, startup-friendly places to launch a tech company.
And if you need help actually making the jump, Teleport actually employs "scouts" in select destination cities whose job it is to do the legwork and help you make the decision on whether or not that locale is for your business.
The Teleport team first noticed the problem during their time at Andreessen Horowitz: Tamkivi had been reflecting on how hard it was to keep moving around (he's lived in places like London, Singapore, and now Palo Alto).
He reconnected while at Andreessen Horowitz with former Skype AI researcher Silver Keskküla, who had similar experiences with his own constant stints at universities across the globe. Andreessen Horowitz general partner Balaji Srinivasan saw value in the vision and joined as a co-founder himself.
After a seed investment from Andreessen Horowitz, SV Angel, Seedcamp, and other investors and Teleport was officially founded this time last year. In fact, tomorrow, April 1st, is the company's one-year anniversary.
In the future, the company is going to experiment with multiple models for making money, including selling reports based on its data. But for now, it just wants to get up and running.
But today, the company is living the multiple-cities lifestyle it's pushing: Teleport has 8 employees across 5 countries, from Estonia to London to Germany. In fact, co-founder Keskküla moved to Columbia recently "just for the fun of it," Tamkivi says.
Oscar Health Insurance, a New York-based startup trying to bring modern tech thinking into the health insurance industry, is in talks to raise a round of funding that would value it at more than $1 billion, according to Bloomberg.
We don't know yet who would be participating in this round, but famed investor Peter Thiel's Founders Fund led an early $30 million round of funding in January of last year.
A few months later in May, Oscar closed an $80 million round of funding at a valuation of just under $1 billion, led by Joe Lonsdale of Formation8 and including Khosla Ventures, General Catalyst Partners, and others. Its total funding sits at $150 million.
The way Oscar Health Insurance competes with the established markets is pretty straightforward: Customers in New York and New Jersey can buy their coverage from the marketplaces created by the Affordable Care Act, better known as Obamacare. Their website is slicker than the competition and lets its customers consult with doctors over the phone for free.
Oscar was founded by venture capitalist Joshua Kushner, an ex-Microsoft exec named Kevin Nazemi, and current CEO Mario Schlosser. Oscar was founded in July 2013, making the company a little less than two years old.
If true, this report would make Oscar Health Insurance the second member of the so-called Unicorn Club of startups that have raised $1 billion this week alone, after Sprinklr announced its own round of funding.
Nebula, a once-hot startup co-founded in 2011 by an ex-NASA CTO and funded to the tune of $38.5 million by some of Silicon Valley's foremost venture capitalists, has gone out of business.
They can't all be unicorns.
Hold tight, because this one gets a little bit personal: I spent a little over a year and a half at Nebula in 2012 and 2013 as a content marketing specialist.
Once, Nebula was hyped up by investors and the media as the ones who were going to change cloud computing by helping people turn their existing server rooms into high-performance data centers of the kind used by Apple, Google, and Facebook to run their web apps.
Today, a farewell letter on Nebula's website reads, in part:
When we started this journey four years ago, we set out to usher in a new era of cloud computing by curating and productizing OpenStack for the enterprise. We are incredibly proud of the role we had in establishing Nebula as the leading enterprise cloud computing platform. At the same time, we are deeply disappointed that the market will likely take another several years to mature. As a venture backed start up, we did not have the resources to wait.
On paper, Nebula seemed like a can't-miss. In addition to co-founder Chris C. Kemp, who headed up the super popular OpenStack open source cloud project at NASA, the executive team at the product's launch included Jon Mittelhauser, who co-invented the first web browser, Mosaic, plus Dave Withers, a former Dell sales bigshot.
Kemp and co-founder Devin Carlen were able to exploit their NASA connections to bring over a ton of engineering talent from the space agency, too. Investors like Ram Shiram and Eric Schmidt’s Innovation Endeavors were quick to put money in.
The Nebula product took two years to develop, with the team trying to get it just exactly right, and was reticent to talk about the work in the meanwhile. While that work was going on, the team was burning cash. Kemp, a passionate public speaker with a NASA resume, was in high demand for technology conferences, keeping the Nebula name out there.
When the product launched in the spring of 2013, the future seemed bright, as Nebula's earliest customers reported positive experiences. But sales were slow to follow. People didn't really understand what Nebula was trying to sell, and many chose instead to go with competitors they understood.
In late 2013, Kemp was replaced by Gordon Stitt, formerly a founder of Extreme Networks through its IPO, as Nebula's board sought change (Kemp stayed on as chief strategy officer). I left in 2013, but Nebula's fortunes apparently never turned around, and it took out $3.5 million in debt financing last April.
"This is a difficult announcement for us to make and we want to assure our customers, shareholders, and employees that we have worked hard to explore alternatives and exhausted all potential options," says Nebula's farewell letter.
The company shuts down today, and customers won't be able to get support for their Nebula clouds.
Just take it as an object lesson in how investor hype, press interest, slick marketing, and cool new technologies are no guarantee of success — you actually need a product that people understand and need.
Everybody wants to be a unicorn, but nobody wants to be a lemon.
Incidentally, while I was there, I wrote the official founding story, some papers, a bunch of sales brochures, and I played a part in scripting the official launch video. (We can't say who that voice is, but if you make a guess, you're probably right).
Venture capital firm Lux Capital, which invests in early-stage futuristic science and tech companies, has closed its fourth fund at $350 million, the company announced Thursday.
Now it has $700 million in total capital under management, Lux Capital co-founder and managing partner Peter Hebert tells Business Insider.
“This is the most thrilling period of scientific and technological experimentation and advancement in the history of mankind,” Lux Capital managing partner and co-founder Josh Wolfe says.
“We believe the next generation of industrialist titans will be scientists, technologists and inventors who are doing more than challenging the status quo—they’re literally challenging the laws of physics.”
Lux Capital has invested in startups including SOLS, a company that makes perfectly fitting 3D-printed orthotics. Lux Capital led SOLS' $11.1 million Series B round in February.
Other companies in Lux's portfolio include 3D printing marketplace Shapeways and Kurion, a startup that combines robots and chemical engineering to get rid of nuclear waste. Kurion was used to clean up waste at Fukushima.
If you want to order food, you probably already use Seamless, Grubhub, or maybe Postmates to get it for you.
But if you're on a college campus, there's a startup that will let you order food from your favorite places while learning your preferences. After enough time, it will know you get your Starbucks mocha every Monday morning and will ask you if you want to order it again.
That company is called Tapingo, and on Thursday it announced that it had raised $22 million in venture-capital funding from Qualcomm Ventures, DCM Ventures, Kinzon Capital, Khosla Ventures, and Carmel Ventures.
"When you buy a coffee, you shouldn't have to wait in line, pay at a register, then wait again," Tapingo founder and CEO Daniel Almog said. "Your phone should know what kind of coffee you like and make sure it's available for you — where you need it, when you need it."
The new cash injection follows Tapingo's Series B round in February 2014 in which it raised $10.5 million from Khosla Ventures and Carmel Ventures. In total, Tapingo has raised $36 million since its 2010 founding.
How it works: When you're hungry, you open up the mobile Tapingo app and order food from a list of local restaurants that work with Tapingo. When you get to the restaurant, instead of waiting in line like everyone else, you skip the line and grab your food. The payment happens through the app, so it's a seamless, cashless transaction. Tapingo uses machine learning, allowing it to make suggestions for you.
More than 85 universities — up from two dozen when it launched on college campuses last year — use Tapingo, including New York University, University of Southern California, George Mason University, and the University of Arizona. The company says it does more than 25,000 transactions daily, and Tapingo is used four times a week on average.
Tapingo works, especially at college campuses, because it caters to impatience and fills the need for immediacy and on-demand service. And if college students' tweets are to be trusted, Tapingo is an answer to a sleep-deprived college student's prayers:
The fact that you can tapingo Starbucks is the best thing that ever happened to me and my coffee addiction— Gabby Boccadoro (@gabbbbbyxoxo) March 23, 2015
BREAKING NEWS: TAPINGO AT STARBUCKS. Heaven has answered my prayers— Ammyyy. (@amylynnlenz) January 29, 2015
Tapingo has turned me into the jerk who beats the 50-person line at Starbucks before morning classes. I'm the one everybody hates.— gaga (@gagazola) November 6, 2013
With the announcement of its new funding, Tapingo, which was founded in Israel and now has offices in San Francisco, has also expanded from ordering into delivery and campus retail.
"Our vision was always to begin with dense retail ecosystems involving high-frequency transactions," Almog said. "We realized that college campuses were the perfect proving ground. What we didn't anticipate was how quickly universities and students would adopt this new behavior. This validated our decision to bring the technology to analogous ecosystems."
When Seth Sternberg's mom began to enter old age, Sternberg realized he didn't know what he was going to do to take care of her.
"I could never trust my mother to the current state of the industry," Sternberg, who lives across the country from his mother, told Business Insider.
"If I wanted to set up in-home care for my mom right now, I'd have to fly to Connecticut, interview 20 home-care providers, pick the one I thought was best, and then fly back to California, and I'd have no idea how my mom was going."
Some research led Sternberg to realize that most seniors wanted to stay in their homes.
To help serve these seniors, Sternberg is launching a service called Honor, which aims to match seniors with professionals who can take care of them in their homes while giving concerned family members a way to keep track of everything.
Here's how it works.
The first part of Honor is an appliance with a screen called the Honor Frame, which sits in the senior's home. It provides information like "Jeanette's on her way, and she'll be here in 10 minutes," or "How did Mary do today?"
When it doesn't have a message to display, the screen can be programmed to show family photos.
Home-care professionals also get an app that helps them find and keep track of job offers. Applicants undergo deep background checks and in-person interviews to screen them, with only 5% being allowed onto the platform so far.
Unlike on-demand services like Uber and Lyft that let people accept jobs right away, Honor wants its home-care professionals, who start at $15 an hour, to foster long-lasting relationships with seniors. Honor tries to teach them what to expect and pair them up with seniors with whom they can work well. For example, a senior who speaks Mandarin Chinese can opt to match with a home-care professional who also speaks Mandarin.
To address fraud and abuse issues, which occasionally surface with home care for seniors, the Honor monitor shows what the home-care professional does while in the home.
Family members also get an app, which they can use to see how long the professional stays in the senior's home and what that person does there.
Families can book Honor for as little as one hour a week.
Sternberg and his cofounders have raised $15 million from Andreessen Horowitz and an additional $5 million from angel investors including Google X's Andy Conrad, Yelp's cofounder and CEO Jeremy Stoppelman, and PayPal cofounder Max Levchin.
Starting this month, Honor will serve seniors and their families in Contra Costa County, California. It will then spread its services throughout the Bay Area. Sternberg says he plans to expand Honor beyond Silicon Valley, too.
But when Jo Burston’s, founder of Rare Birds, four-day trip to the inspiring entrepreneurial island came to an end, she decided it wasn’t enough.
So she did something most people would be afraid to do – she asked for more.
“I decided that my time there was not done and I listened to my gut instinct not to leave,” Burston said.
“I spoke to management and asked if I could stay a bit longer. Fortunately they had a cancellation in the next group, so I stayed on for another three days.”
It was during this rare opportunity to have extended time on the island that she struck entrepreneurial gold.
“On the first day of those extra three days Richard came up to me and gave me a hug and said: ‘I’m happy you’re staying’.”
It turns out Branson had taken quite an interest in Burston’s idea to build an online resource for women seeking a mentor, and partnered this with his Virgin Unite business so they could expand the idea commercially.
They started talking more seriously about the business model and brainstormed how it would work.
“Next thing, I was drafting a proposal document and sent it off to his Virgin Unite team,” as she said, “and they loved it”.
Burston then flew straight from the island to London to meet the Virgin Unite group, where they started negotiating a deal.
“Twelve months later we’ve got this world class mentoring platform that we’ve co-developed,” she said.
“Rare Birds Mentoring is unique to how entrepreneurs are mentored and how we’re going to be able to collect data in the future, and research what are the success factors in becoming a mentor.”
Using a matching algorithm, similar to that used by dating sites, women can be paired with the right mentor to accelerate the growth of their business and receive the specific guidance they need.
Rare Birds is the first organisation to use the unique Virgin Unite platform outside of the UK.
Business Insider asked Burston what it took to get the deal done and what advice she has for other Australian startups looking for a partnership overseas.
You have to be quick thinking.
“My mind works in strategy-mode at one hundred miles an hour anyway so I could see really quickly how the relationship with Richard was developing and opportunity to align that with Rare Birds was there.
“I thought about how to make it a win-win situation and how to make it happen really quickly.
“I wanted to leave the island with something tangible,” she said, so she went for it.
“I think this there is an expectation when working with an entrepreneurial that [working fast] happens in a business. It’s like Richard’s famous quote… ‘say yes, and work it out later’.”
It has to be win-win, balanced partnership.
“It’s a collaboration. One can’t do without the other. It’s a process of both our ideas, of both our means of development. It’s about both people walking away feeling like it’s a great deal.
“Like any relationship, there has to be an expectation of how each other behaves in the relationship commercially and how we behave in the relationship in general. There has to be guidelines, boundaries, and an understanding of outcomes, deliverables and expectations. We worked hard to make sure it was a win-win environment.
Build a strong, trustworthy relationship.
“A lesson for me is that building deep and meaningful relationship is where the best outcomes lies.
“It’s a like a marriage – you court, work out if it’s going to work and then you work hard for it continue to work.
“Developing this strong, deep trust ensures that the relationship will work not just now but for many, many years.
“We’ve already started to plan future developments around what we’re going to do together. Today is just the start of a long journey together.
Be prepared to work hard.
We’ve all put hundreds of hours into it… I can’t imagine that anything that is worthwhile not being hard. If it was easy everyone would do it.
“The effort and energy and time being put into it is because we want to create something magnificent. I think always an entrepreneur you go the extra mile, you do that extra hour.”
Align with a brand which has the same values as your own.
“Know exactly how your own brand is going to align with another brand based on the depth of understanding of not just your own business, but the other business, its people, their mission and values.
“If values aren’t aligned where do you go when things go wrong? How are you going to remind each other about why you’re doing it?
“It will ensure it [the partnership] has the best possibility of success.”
SEE ALSO: 18 mistakes that will kill your startup
The sunny campus of Stanford University, with its many trees, sprawling quads, and kids with backpacks, looks like many American colleges. But because Stanford is in Palo Alto, California, in the middle of Silicon Valley, things are happening there that don't happen anywhere else.
Start with the money students make just after leaving.
The average starting pay for a Stanford graduate with a computer-science degree is $90,000, according to PayScale, a company that aggregates salary data. That's more than the median salary for a person with a bachelor's degree and 20 years of professional work experience — and well above $52,000, the median household income in the US.
For Stanford grads, the money can get even bigger.
Big publicly traded tech companies like Facebook, Google, and LinkedIn regularly pay new hires out of Stanford a salary of between $100,000 and $150,000. In addition, those companies will offer stock grants worth $100,000 or more. Sometimes there are signing bonuses close to $25,000 (and less-established tech companies often offer top Stanford recruits much more than that).
The numbers can hit $500,000 or more. This time a year ago, Snapchat was offering Stanford graduates $100,000 to $150,000 in salary and $400,000 in stock grants vested in four years. Snapchat's offers are lighter this year; finishing students are being offered no more than $300,000 in stock.
Because stock in tech companies can sometimes appreciate quickly, stock grants can make Stanford students wealthy at a young age. In 2013, Snapchat was a $3 billion company; now it's worth $15 billion.
Many Stanford students don't have to wait until after college for the big money to start coming. In Silicon Valley, most of the established tech companies, and many fast-growing startups, host student interns every summer and pay them between $4,500 and $7,000 a month for three months.
Why does the industry work so hard to recruit Stanford students?
Representatives from Google, Snapchat, Facebook, and Dropbox declined to comment on the record for this article. One representative said her company did not want to give the impression that it favors students from Stanford over those from other universities. But, speaking on background, one industry source agreed that Stanford students are, on the whole, more appealing to tech companies. Tyler Willis, the CMO of Hired.com, a company that connects job seekers with companies, says it's not unusual for Facebook or Google to hire 300 to 600 entry-level engineers in one year. The first place those companies look is the university down the street.
It's not that the school has a superior computer-science program, which is good but not better than departments at, say, Carnegie Mellon, MIT, or Waterloo. It's the school's proximity to the industry. Palo Alto is blocks from where Google CEO Larry Page lives and Steve Jobs died.
It's not that the school's computer-science program is superior to those at, say, Carnegie Mellon, MIT, or Waterloo. It's the school's proximity to the industry. Palo Alto is blocks from where Google CEO Larry Page lives and Steve Jobs died.
Yahoo, Google, and Facebook grew up there. Billionaires can walk to campus and deliver a lecture on Thursday night and later stroll home.
After students arrive on campus, they become immersed in, and infatuated with, the industry. Then they intern locally and learn what it takes to be a good employee in the industry. Just like Google's careers page tells them to, they walk around telling everyone that what they want is to "do cool things that matter." Then, when they walk into Snapchat or Google on day one after graduation, they know what is expected of them: lots and lots of coding.
"At the Googles of the world, the truth is there is so much engineering work happening that you basically need an army," says one industry source. "Stanford grads are not only experienced and talented but they are willing to slide in at the right level."
Some Stanford students forgo the big salaries they could earn in entry-level jobs. Instead, they start companies.
Many are now well-known billionaires. Larry Page and Sergey Brin made Google. Jerry Yang and David Filo created Yahoo. Reid Hoffman cofounded LinkedIn. Elizabeth Holmes created Theranos. Evan Spiegel and two of his Stanford fraternity brothers created Snapchat.
What is it like to be a 21-year-old computer-science student at Stanford surrounded by all this success and money, knowing that if you work hard and don't screw up a good amount of that money and success is sure to be headed your way? What's it like being such a valuable living commodity?
We began to wonder about all of this a couple of months ago, so we started calling Stanford students and asking them. Following are some of their stories.
Vinamrata Singal, a soon-to-be Googler
Both of Vinamrata Singal's parents are doctors, and she went to Stanford planning to become one, too. But during a weekend at Stanford held for incoming freshmen, she met with her future adviser, a lecturer named Jerry Cain.
Cain encouraged Singal to consider studying computer science. She told him she was intimidated by the idea. She had never coded before. Cain had Singal meet with three women who were stars of the computer-science department who had also never coded before they went to Stanford. That fall, Singal took an introductory computer-science class. Within weeks, Singal decided she would pursue a computer-science major.
Switching majors is common enough. What's uncommon is what Singal did next: She began her career.
Just weeks after starting her first computer-science class ever, Singal went to a career fair and asked the recruiters what they were looking for. They used a lot of terms Singal didn't understand. She worried that her chances of getting an internship were bad. She sought to improve her situation.
Singal got a job working 10 hours a week doing quality-assurance testing for a company called DigiSight. Basically that meant going through DigiSight's apps and trying to find bugs. It wasn't coding, but it was technical work at a company that made a technical product. Singal added the job to her résumé and uploaded it to Stanford's career-development website.
What happened next was the kind of thing that almost only happens at Stanford.
Just months after starting her computer-science studies, she got a note from PayPal, the payments company owned by eBay. A recruiter had seen her résumé on the career website, and an engineering manager wanted to interview her. PayPal offered Singal a summer internship. When Singal accepted, the company sent the teenager a gift package full of candy and coffee mugs for her parents.
What happened next was the kind of thing that almost only happens at Stanford. Just months after Singal started her computer-science studies, PayPal offered her an internship.
Back at Stanford, in the fall of her sophomore year, Singal attended an information session put on by Google. She had an interview and got an offer. (Singal got quite a few offers from other companies that fall. One asked her to write down all of the offers that she had gotten so that it could make her a winning bid, but Singal ultimately went with Google.)
At Google, Singal attended an information session about Google's associate product manager program, which she had heard about. It's a popular program that was created nearly a decade ago by Marissa Mayer, the early Google employee and Stanford graduate. Mayer created the program to help Google hire technically adept people for management roles.
Google made Singal an offer, and she's going to do the program this summer. Singal didn't tell us the figure, but according to reports, Google will pay her about $6,000 a month. Google will pay for her housing and a twice-weekly house-cleaning service. It will also make hair stylists available to her at the office twice a week.
If the internship goes well, Google will almost certainly make Singal an offer for a full- time job, one that will pay her about $125,000 a year and award her a stock grant of at least $100,000.
Singal says money was not the reason she decided to work at Google. "Money is not the issue," she says. "What really drew me to Google is their mission and their culture. I think they are solving really cool problems and they really care about impact."
Myles Keating, an incoming Microsoft intern
Late last year, Stanford junior Myles Keating took a trip to Seattle. He was visiting to interview for a summer internship at Microsoft. As much as he intended to sell himself to Microsoft, Microsoft planned to show itself off to him. Minutes after Keating landed, he was chauffeured to Microsoft, where he got a grand tour. One highlight was Microsoft's gigantic gym (which the SuperSonics had used before moving to Oklahoma City).
Keating sat down for a meeting with a team of engineers working on machine virtualization, an interest of his. He was introduced to his future mentor.
He was told about the perks of the internship, including a massive event Microsoft puts on for its summer interns called the "Intern Signature Event." A couple of years ago, Microsoft rented out Boeing's headquarters for the event. Seattle restaurants set up on an airfield. Interns took a tour of the factory and then had a wine tasting. There was a concert just for them featuring Macklemore and Deadmau5.
Microsoft made Keating an offer. On average, Microsoft pays summer interns $7,500 a month with a monthly housing stipend of $2,500. That's $30,000 in all.
Eventually, Keating took the Microsoft gig, but not because of the money or the perks, he says. For one thing, the perks were pretty standard. Just as Microsoft has its Intern Signature Event, other companies have their special weekends and trips. Google does a cruise around San Francisco Bay. Dropbox has a "Parents' Weekend." Oracle flies interns around in a helicopter.
As for the money, Keating says it was not the deciding factor. It won't be when he considers full-time jobs after Stanford, either.
It's more important for him to feel like he's on a mission. "I want to work on problems that matter with people who care," he says. "I want to work on problems that I think are important. I want to feel like I'm valued, but never that I'm being coddled."
Keating says he can worry about money later if he has to.
"I have all of this ridiculous earning potential. If, for whatever reason, I decide that I value money more later down the road, I can do that. For right now, what I'm really looking for is to learn a lot and to feel meaningful in my work. So I'm going to do something a little different."
He starts at Microsoft in June.
Kyler Blue, a 'startup dropout'
Kyler Blue was recruited to Stanford to row crew. He had no real awareness of the tech industry. He started taking classes for a degree in product design. Then, two summers ago, he interned at Extole. There, he was asked to build some websites and design emails for clients, including Spotify and Dish Network. Within weeks, millions of people were visiting the sites he designed. Blue was thrilled. He joined a startup called Riffsy in 2013, his junior year, and worked there while still taking classes at Stanford.
In the spring of 2013, word started to spread that Apple was going to integrate keyboard software from third-party companies into its iPhones and iPads.
Blue helped design one for Riffsy, almost on a lark. The keyboard that Blue and Riffsy came up with allows iPhone users to include GIFs in text messages. Apple loved it, and it included Riffsy in its annual keynote presentation in front of millions of Apple users and developers.
In 20 days, the keyboard was downloaded 1 million times. The GIFs included were viewed 500 million times in a month. In November, Riffsy raised $3.5 million in venture capital from Redpoint Ventures, an early investor in Netflix and TiVo.
In January, Blue quit going to classes. He says he's still a Stanford student but that he's on a leave of absence. He says his Stanford advisers told him it was the right thing to do.
Andrea Sy, a mentee
To judge by how often people talked about them, "mentees"— people who are mentored — did not exist until recently. According to a search through the more than 20 million books that Google scanned, "mentee" accounted for just .0000000091% of all English words used in books and magazines in 1958. By 2008, the most recent year available in Google's search, the word was 3,000 times more common.
Nowhere is the rise of the mentee more obvious than at Stanford, where a steady supply of potential mentors from the tech industry flows through campus. They come formally as guest lecturers and advisers to entrepreneurial organizations or informally on their own. Some are in business with professors.
The mentors go to Stanford to meet students like Andrea Sy, a senior who is completing her major in management science and engineering this spring. She's also a mentee, at least three times over.
One of Sy's mentors is Ellen Levy, who describes herself on her LinkedIn page as an "Angel Investor, Advisor, Consultant, Entrepreneur." Sy met Levy through a professor.
Another mentor is Benson Yeung, an IT consultant. Sy met him when she took Engineering 145. In that class, students group together and come up with a business idea to bounce off an official mentor from the industry. That was three years ago. Since then, Sy and Yeung get coffee once a quarter.
Sy's newest mentor is Jeff Heilman, a sales executive at Intel. Sy says the first time she met him, his parting words were, "Andrea, I want you to text me, or email me 10 times a day. As many times as you have questions. I want to hear from you as often as possible."
After she graduates, Sy plans to work for, or even launch, a startup. At one point, that was not the plan.
Sy's first job in the industry was one that Yeung helped her get, an internship at a company called Skytree. The next summer, Sy interned at a big publicly traded tech company and worked on data science. The internship went really well. Sy cold-emailed the CEO, who agreed to meet with her. They talked about her future.
At the end of the internship, the big publicly traded company offered Sy a job. Sy didn't say, but it's likely this job would have paid her about $100,000 a year. There would have been a significant stock grant as well.
At first, Sy thought she would take the job. But before accepting the offer, she wanted to consult her mentors, new and old.
She cold-emailed a senior engineer at the publicly traded company. This engineer agreed to have breakfast with Sy the next morning. They charted out her career.
Sy reached out to her intern manager. They discussed her long-term goals, which are to create a startup and eventually go back to the Philippines and develop its entrepreneurship ecosystem.
Stanford has a large radio telescope on its campus that everyone calls "the Dish." She went on a hike or two to the Dish with her mentors to discuss her future. After all those conversations, Sy turned the big publicly traded tech company's offer down. "It was definitely a very long and hard process," Sy says.
Ultimately, she says, she felt comfortable turning down the rich offer: "I was given a lot of support and encouragement by a bunch of mentors, who said that it was possible for me to do whatever I wanted to do. If I wanted to start my own company, that's possible," Sy says.
Kyle Wong, a slightly less successful classmate of Evan Spiegel
Kyle Wong has been out of Stanford for a couple of years now. When he was still at Stanford, he took a class with Evan Spiegel, who would go on to cofound Snapchat, the photo- and video-messaging startup that's now reportedly worth $15 billion. (Spiegel is the world's youngest billionaire and lives in a $3.3 million house in Brentwood, California.)
Wong also started a company, and it's also in photo sharing. It's not as successful as Snapchat. Wong only recently moved out of a one-bedroom house he shared with four other men.
Wong started his company, Pixelate, with a best friend from high school, right after they graduated from college. Wong says he intentionally ignored overtures from big tech companies that wanted to hire him because he did not want there to be a comfortable plan B for him to fall back on. He went all in on starting a company.
When current Stanford students ask Wong for advice, he tells them not to do what he did. Pixelate is not a failed company, but Wong says keeping it going has taken a huge amount of stressful effort.
Coming out of college, Wong didn't have any savings. That meant he had nothing to lose if his startup failed, but it also meant he had nothing to live on. (He had to figure out the cheapest, highest-calorie food at the grocery store. One of his roommates slept in the kitchen.)
Wong thinks he was not mature enough to run a company when he started Pixelate. He didn't know what a real work environment was like. He didn't know how to give employees negative feedback. He didn't know how to inspire them. He didn't know how to fire someone, because he had never seen anyone get fired.
Wong says Stanford did not teach him how to deal with adversity: "If you don't get into the class you want at Stanford, you use a petition and hopefully you'll get in. In real life, it's a little bit different."
John Yang-Sammataro, a graduate student who works 98 hours a week
If John Yang-Sammataro were going to work for a big tech company after he finishes his master's program in the spring, he would work for Twitter. He interned there a couple of summers ago. It was great.
But he isn't going to work for Twitter. He can't. He's got 15 employees who depend on him to keep running his business.
Yang-Sammataro was born in Boston and grew up assuming that he'd go to an East Coast school and end up on Wall Street. But then he kept getting into trouble in boarding school for starting unauthorized businesses. An uncle told him there was a school that would encourage that kind of behavior: Stanford.
Yang-Sammataro went to Stanford as a freshman intending to study finance or business. That didn't last long. "I took one CS class, two CS classes, and pretty soon I was doing operating systems," he says.
This kind of thing happens a lot at Stanford: Students arrive on campus certain that they'll pursue one passion but then get pulled into studying computer science. Some of the students we talked to called this the "CS vortex." Usually its gravity works only on people already pursuing left-brained majors: electrical engineering, math, or mechanical engineering. But we spoke with one student who spent three years studying literature before giving it up to become an engineer.
Yang-Sammataro wasn't ready to leave Stanford when he finished his undergraduate degree in 2014. So he opted to stick around through a program Stanford calls "co-terming." In it, Stanford seniors can reapply to the school to finish a master's degree. It's almost free, if you help teach some undergrad classes. Lots of computer-science majors use the program to experiment with startups between summer and fall or extend their job search a few months.
After a junior-year internship at Twitter, Yang-Sammataro decided he didn't want to work at a big company. Nor did he rush out to start a venture-backed company the way Kyle Wong or Evan Spiegel did.
Instead, he hired some of his friends around campus, including Andrea Sy, and built a small company that does contract coding work for big companies, including Google and Facebook. His plan is use the money that those projects bring in to finance some sort of in-house startup project. Yang-Sammataro's company is called Silicon Valley Insight.
Between his graduate classes and all the contract coding, Yang-Sammataro says he's now working 14 hours a day, seven days a week. He's not making much money, he says. Definitely not as much as his friends at large tech companies who are pulling six-figure salaries.
"At this point," he says, "it's a really great way to basically learn these different things. I get to learn management, hiring, recruiting. I get to learn operations. I get to learn business development. I can't tell you how fortunate I feel."
A Stanford grad student who didn't want us to use his name
We spoke to one Stanford graduate student who asked us not to use his name because he wanted to speak candidly without damaging his career prospects.
This student is pursuing a job in the tech industry, but he does not want a job as a software engineer. He wants to be a product manager. He's having a hard time.
"If you are a software engineer and you're looking to get into software engineering, then you're in a great spot [at Stanford]," he says. "Most likely, things are going to work really well for you. Every company is looking for people who can code. You can feel the desperation of companies to hire," he says.
"That being said, the top companies — like Google, Facebook, Uber, Snapchat — are still incredibly hard to get into. There is a lot of competition. Finding a job is no longer a problem, but finding a good job is a problem.
"If you're looking to get into anything besides engineering — business development, sales, and other functions that are related to technology companies but not directly engineering itself — these jobs are incredibly hard to find.
"There's a ton of competition, because now the restrictions on your background are lifted. That means there's a humongous amount of competition."
This student says he heard that this year LinkedIn got 5,000 applications for six spots in its associate product manager program.
This student says he heard that this year LinkedIn got 5,000 applications for six spots in its associate product manager program.
He thinks it's slightly easier for a non-engineer to get a job at a risky startup or an enterprise company, one that sells its products to other companies instead of consumers.
The student says his hunt is made more frustrating because his friends who do want to be software engineers keep getting huge offers. He has a friend who got a $500,000 all-in offer from Snapchat, a slightly smaller one from Uber, and another from Facebook.
As hard a time as he's having finding the job he wants, this student says he can only imagine how much worse it must feel to be a nontechnical student at Stanford — "a person who might on a day-to-day basis be much smarter than a computer-science student."
He worries that all these people will succumb to the CS vortex:
"When you're coming into college, one of the things you want to keep an eye on is the whole job thing. If you do that, why would someone who's always loved writing or loved art not choose CS as your major? How many people are actually going to be able to rise above the economics and be able to pursue those things?
"We're creating what is a generation of people who, 20 years down the line, are going to have a lot money and still feel like they made bad choices back in college."
This student says if he were writing this story he "would try to find someone who has turned down ridiculous offers just because they want to work on their own thing."
Jessica Taylor, a girl who turned down Google because of the robots
Like Vinamrata Singal, graduate student Jessica Taylor started working at Google very early in her Stanford career. The summer after her sophomore year, she worked there as a software-engineering intern. She did the same after her junior and senior years.
After her last internship, Google made Taylor an offer. She did not tell us what it was, but, according to other Stanford students, it likely included a salary of between $100,000 and $150,000 and a stock grant worth between $100,000 and $200,000.
Taylor wasn't sure if she wanted the job. She visited with her manager at Google, someone she had worked with for years by this point. After much discussion, Taylor's manager delivered a final message to her: It's OK to be selfish.
What this manager meant by that was not that it was OK to accept such a huge amount of money and spend it on whatever. She meant it was OK for Taylor not to work for Google, if that's what she wanted.
It was even OK for her to go work for a nonprofit research institution for about half as much money.
Taylor's "selfish" desire is to "do the most good for the world."
She describes herself as an "effective altruist." It's a philosophy espoused most vocally by Peter Thiel, the venture capitalist who made his money cofounding PayPal and investing in Facebook very early.
She describes herself as an 'effective altruist.' It's a philosophy espoused most vocally by Peter Thiel, the venture capitalist who made his money cofounding PayPal and investing in Facebook very early.
Effective altruism is different from normal altruism in that its adherents are supposed to make their decisions based on evidence, not sentiment. Also, it has an annual conference. One strategy of effective altruists is "earning to give"— that is, getting rich and giving some of the money away.
For a while, Taylor favored this strategy and considered pursuing it by launching an artificial-intelligence startup right out of Stanford.
She eventually moved on from this idea. In part, this is because she met the people at MIRI.
MIRI stands for Machine Intelligence Research Institute. Its mission is to "do foundational mathematical research to ensure smarter-than-human artificial intelligence has a positive impact." MIRI is a group of people who are worried that if artificial intelligence is not developed correctly, it will destroy the human race, enslave it, or otherwise make life worse.
It's a growing fear in Silicon Valley. Tesla CEO Elon Musk recently donated $10 million to an institute with a similar mission to MIRI's.
Taylor is already working with MIRI part-time and thinks she will go full-time when she finishes her degree this spring. She's excited because MIRI has only three full-time researchers and she'll be able to make a contribution to the team.
She says she will make about half as much money working there as she would have at Google. She's also not worried about the money.
"If I bought most of the things I wanted, I don't think I would end up spending that much money," she says.
Rafael Cosman, the one who just wants to make enough money to live
Two summers ago, Stanford senior Rafael Cosman interned at Palantir, the super-secretive data-science company that works for the CIA and other organizations.
It was an impressive internship to get. Palantir pays interns about $7,000 a month.
But Cosman wasn't very impressed with the place when he first got there. He saw that some of the most talented interns were getting put on boring projects.
Cosman decided he wouldn't put up with it.
"I talked to my mentor," he says. "I talked to him and said, 'Look, they're going to assign me to some lame project. I really don't want to do that. Can you give me a couple of weeks to just explore around Palantir, figure out where the most interesting work is happening and then go work with those people?'"
Cosman's mentor said OK. "Which I really respected," says Cosman.
Cosman ended up working with a team of four on a tool that used machine learning to predict crime.
It was "very exciting" and "very interesting," he says. But he still left Palantir certain that he did not want to work for a big company after he graduated.
"Palantir is a great tech company full of a lot of smart people. They're working on some interesting problems, but most of the people there are not. You need to fix the UI of something. It's not really what you want to do, but you've got to do it."
The next summer, he worked on a startup with some classmates. Its product was an educational video game — "like Minecraft but set in space." For Cosman, the most interesting part of the game was that to do well, players had to learn how to program spaceships. Cosman had always been interested in computer-science education.
Over the summer, he realized his cofounders were less interested in the educational aspects of the game and more interested in pure gaming. Cosman quit the startup.
"Working on something and not really believing in what you're doing is really hard," he says.
Ultimately, Cosman decided that the for-profit tech world wasn't for him.
For most of the past year, Cosman had been working part-time at a nonprofit coding and technology school in East Palo Alto called the Street Code Academy. He recently accepted an offer to work there full-time after he graduates.
East Palo Alto is a relatively poor city next to Palo Alto. But along with the rest of the Bay Area, its housing prices are starting to rise. It's gentrifying. Cosman says the changes are forcing Hispanic and black families out of their homes. He blames the tech industry.
"The folks who are starting to move into East Palo Alto are the white employees of Facebook," he says.
Cosman says the Street Code Academy's mission is to teach the youth of the area how to code so that they can be the ones getting tech jobs that pay enough for East Palo Alto's new rents.
If Cosman were to work at Palantir or a similar company, he may have eventually been able to ask for a salary north of $125,000 in his first year out of school.
He's not sure how much he'll make at the Street Code Academy. He is not concerned. "The amount of money that I need is minimal," he says. "I just need enough money to be able to buy a loaf of bread to eat and clothes to wear. Collecting lots of money is not something that I care about."
The glow will fade.
Myles Keeting, the Microsoft recruit, says that when he was a freshman, there was a rumor going around that a senior finishing up a mathematical and computational sciences major was going to go work for some huge bank and earn a salary of $900,000, with a bonus that would surely put him over $1 million a year.
"Those numbers just make your eyes pop," he says.
And yet Keating and almost all the other Stanford students we spoke to said the decisions they're making to begin their careers have little to do with money.
Instead, they talk about how they want to have an influence on the world and do good. According to Hired.com data, 80% of these students turn down the biggest offers they get for lower-paying jobs.
Are they naive? Or are they wise?'
One student, who asked us not to use his name for this quote, said he thinks Stanford students may turn down huge offers because, to them, "that money is almost not real in a sense. We don't have to deal with personal finances that much. Our parents still pay our bills, and we get free room and board.
"I don't think a lot of people have a sense of what the money means. So maybe when we get out into the real world people will start to care more about the money."
When Andrea Sy told her parents back in the Philippines that she was going to work at a startup and forgo a big salary, they asked, "Are you crazy?"
Eventually, she convinced them that now is the time to take risks.
"In the future, I might have a family and more things to worry about," she says. She feels less pressure to chase a big paycheck because she doesn't have a lot of student debt, she says.
"I guess I'm pretty fortunate in that I have my parents that have supported me throughout my college education," she says.
Many of the Stanford students we spoke with said they weren't worried about money right now because their Stanford education provided them an earnings potential that would always be there.
For example, Jessica Taylor, the girl who opted not to work at Google, says, "I have pretty high confidence that I could in the future reapply at Google or apply at some other company like Google and probably get a decently good offer again."
It might not be so simple.
Tyler Willis, the CMO of Hired.com, says that right out of school, Stanford students get bigger salaries than their peers from MIT, Waterloo, Carnegie Mellon, and other top engineering schools.
This confirms PayScale data, which shows new Stanford computer-science grads get paid 9% more than MIT grads and 28% more than Cornell grads. But Willis says his data also shows that, after two years of work experience, Stanford graduates get no premium over graduates from other schools with equal work experience.
"The way that I interpret that data is that the brand of where you went to school matters a lot to get your foot in the door," he says. "Once you've got some projects under your belt that you can point to, the educational brand matters less."
Brother-sister duo Rishi and Tapasya Bali grew up at the base of the Himalayas in India, an area known as the birthplace of yoga.
In 2010, both quit their Wall Street jobs — Rishi at Goldman Sachs and Tapasya at Credit Suisse — to start a company to bring them back to their yoga roots.
Their yoga apparel and lifestyle company, YogaSmoga, has now closed its $6.5 million Series B round, valuing the company at $74 million.
Eighteen months ago, YogaSmoga was valued at $12 million, Rishi Bali, the company's CEO, tells Business Insider. The new round of funding was led by former Goldman Sachs partner Ravi Singh, who is also on YogaSmoga's board of directors.
The New York-based company has retail locations in Greenwich, Connecticut, and Los Angeles as well as research-and-development locations in Massachusetts and California. Bali tells Business Insider that the company is growing quickly. YogaSmoga has grown to 40 employees from two in 18 months, and it has plans to double its employee count this year.
To stand out from the competition, YogaSmoga positions itself as a more authentic yoga brand. Both its founders were raised in and understand the culture of yoga and the lifestyle around it.
"While other companies use Yoga as a marketing tool, we are yoga company that makes things for life, and this difference in philosophy makes us operate at a much higher level than any of our competition and have a deeper connection with our customer," Bali tells Business Insider. "Our authentic connection to yoga helps us understand the needs of our customers and make a very luxurious product that stands up to the demands of the consumer."
YogaSmoga's prices are similar to its competitors: a pair of YogaSmoga Ballerina leggings retails for $98, the same price as Lululemon's Devi yoga pants. YogaSmoga, however, has developed new fabric technology to create pill-resistant, moisture-wicking products, and it makes its products in the US.
"We have a commitment to how we dye our products," Bali says. "We don't use harmful formaldehyde based pigments that are harmful to the environment. We use superior dyes that don't fade, don't bleed — everything is done in super eco-friendly labs in California."
In line with its commitment to the authenticity of yoga, Rishi tells Business Insider that the company also doesn't retouch any of the pictures on its website.
"Our goal for YogaSmoga is to grow to be a leader in this category," Bali tells Business Insider. "Both our products and ethos resonate with our consumer base, and we are growing at a very rapid pace. We expect to be at 100 retail outlets in the US by 2018 and be close to our where our consumer is."
Six years ago, OnLive came up with a radical idea: With a good enough Internet connection, you could stream video games from the data center into your home, the same way millions do with Netflix Instant Watch movies today.
Soon, OnLive will be no more, as it sells most of its important technologies to Sony and prepares to shut down service by the end of the month.
It's been a long and tumultuous journey for OnLive. Funded by companies like Warner Brothers, Autodesk, and AT&T, the service launched in mid-2010 at a price of $14.95/month plus the cost of individual games (that monthly fee would soon be waived).
Games could be played from any PC, Mac, phone, or tablet. More recently, Amazon added OnLive support to its Fire TV and Fire Stick media players.
The problem was that in 2010, not enough Americans had the kind of broadband Internet connections needed for the high-velocity world of video games. And even when more people did get fast connections, people generally preferred to buy their games through more traditional channels — after all, you can play those without an Internet connection at all, and you don't have to worry about performance issues.
OnLive tried to reverse its fortunes, including launching a virtual desktop service that would let customers access Windows apps in their browsers, but it wasn't enough.
In 2012, OnLive's management took desperate measures: It laid off its entire workforce at once, entered into a proceeding known as the "Assignment for the Benefit of Creditors" that left employees with worthless options, and sold all the company's assets to a private equity firm for a mere $4.8 million, a tremendous dip from OnLive's one-time $1.2 billion valuation.
In 2014, the company came back to life with a service called CloudLift, that took a player's existing games and let them continue it from any device.
Apparently, that didn't work either, and on April 30th, all of OnLive's cloud services will be shut down, forever. Sony is snapping up OnLive's patents, which only makes sense, given that Sony bought a similar service called Gaikai for the technology that lets it stream games directly to PlayStation game systems.
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