Many startup CEOs try to sweep bad news under the rug.

I know this firsthand having been laid off on a random Monday afternoon when the company I worked at abruptly shut down.

But on Thursday, Buffer's CEO, Joel Gascoigne, transparently laid out what happened to his company and how it got to the place where it needed to cut 11% of its staff, or a total of 10 team members.

Instead of trying to dodge the issue, Gascoigne's piece is a good lesson on how to be transparent and acknowledge mistakes that he made as a leader.

"It's the result of the biggest mistake I've made in my career so far. Even worse, this wasn't the result of a market change—it was entirely self-inflicted," the CEO wrote.

Gascoigne described what happened to Buffer as moving into a house that it couldn't afford. The San Francisco-based company, which makes social-media management tools, had been able to previously curb its burn rate, or how much money a startup spends, by boosting revenue through new products.

But the company over-hired, growing from 34 to 94 people in a year. There was also a lack of accountability, overaggressive growth choices, and not enough scrutiny of its financial model until it was too late.

Buffer has a history of being transparent — it's the startup well-known for publishing its employee's salaries online. Still, Gascoigne acknowledged that it didn't live up to it in the end since the realization that the company was spending more money than it was taking in would come as a surprise to most.

"I don't feel that we fully lived up to our value of transparency, specifically to share early in order to avoid a big revelation later," Gascoigne said. "As a result, our team was understandably surprised by the changes we've made, especially the loss of teammates and friends."

Buffer had to account for more than just a smaller headcount. Gascoigne and his cofounder took a salary cut and the company cut perks — like retreats and wellness credits — and laid it all out:

• "We made 10 layoffs in order to recover to a healthier financial position. Savings: $585,000"
• "Both Leo [Widrich] and I have taken a salary cut of 40% until at least the end of the year.Savings: $94,000."
• "Leo and I are committing $100k each in the form of a loan at the lowest possible interest rate, with repayment only when Buffer reaches a healthy financial position.Savings: $200,000."
• "We adjusted the loyalty portion of our salary formula. Each teammate previously got a salary bump of 5% on their year anniversary with Buffer. Now it's 3%, applied for everyone who has been with the company longer than a year. Savings: $74,000."
• "We've discontinued two perks (with the hopes of bringing them back in 2017, if we are able):
  • "A health & wellness grant of up to $100 per teammate per month. Savings: $49,000.
  • "An annual vacation bonus of $1,000 per teammate and $500 per dependent. Savings: $52,000."
• "We canceled our upcoming team retreat to Berlin. Savings: $400,000."
• "We cut our sponsorship budget. Savings: $75,000."

While many startups are facing cost-cutting measures, whether it was a case of not keeping close track of finances or failing to find funding, few have laid it out in such a transparent way to be an example to others.

Read Gascoigne's full breakdown of what it's like to layoff 10% of your team here.

SEE ALSO: One Kings Lane was worth nearly $1 billion, but now it's been sold for a 'not material' amount to Bed Bath & Beyond

Join the conversation about this story »

NOW WATCH: Meet the founder of a hot fintech startup that an old-line insurance company paid $250 million to buy

A blue flame burns brightest and hottest.

In the startup world, “blue flame” is a term used by venture capitalists to describe their ideal founders. VCs use the term as a critique of older founders, saying “they’re not blue flame enough.” What these investors want are founders in their twenties with no kids, and no personal life, willing to work all hours.

I first heard the term recently, in this Business Insider article. While the term may be new, the age bias that VCs display is not. In my research for my book Never Too Late to Startup, I interviewed dozens of founders in their late 30s, 40s, and 50s. Virtually all of them encountered this same type of bias.

One entrepreneur, Sara Schaer had built a successful career in Silicon Valley before starting her new company, KangaDo. She was a senior product manager at Snapfish.com, both pre- and post-acquisition by HP, managing a large team on multiple continents.

Schaer and her cofounder bootstrapped their new company for almost a year. When she went out to raise money, she described her experience with investors this way:

I mean, nobody comes out and says ‘You’re too old,’ obviously. However, I have been made aware by what I would consider friendly investors, ‘Hey you should be aware, you don’t either look or sound like the Mark Zuckerbergs of the world.’ 

One investor told me, ‘Look, I think you have your act together. You’re very thoughtful and you have answers to all my questions, but you’ve got to realize that investors are looking for a pattern… that pattern doesn’t look like you.’ 

Pattern matching is lazy

VCs justify the bias by talking about “pattern matching.” They claim to be looking for founders who “fit the pattern” of the most successful companies. In this case, their universe of the “most successful” can be anything they deem it to be, with no actual study.

Anecdotally, the VCs could find plenty of successful “older” entrepreneurs as exemplars if they wanted to look. For every 20something, there is Aneel Bhusri and David Duffield, who were in their forties and sixties, respectively, when they founded software powerhouse Workday. There is Lew Cirne, founder of New Relic, or Robin Chase, founder of ZipCar.

But beyond the anecdotes, there is actually data that shows the high amount of entrepreneurial activity among older entrepreneurs, as well as their higher likelihood of success.

The Kauffman Foundation, one of the largest backers of research to support entrepreneurship, has completed multiple studies on the age of entrepreneurs. One such study found that the highest rate of entrepreneurial activity is occurring among the 55-64 age cohort. The group with the lowest activity? The 20-34 year old group.

You may be asking, ‘That’s fine for starting businesses, but what about producing successful companies?’ Another Kauffman study, authored by Professor Vivek Wadhwa, showed that the average age of successful tech company founders was 39 when they started the business.

When I spoke with Professor Wadhwa, he was quite adamant that VCs were simply wrong in their approach:

I receive messages practically every other day from people who have achieved extraordinary success and did it without venture capital. I was literally responding to one 20 minutes ago. These are the types of emails I get all the time. People who defy the odds and achieve success. 

Experience makes a big difference [in startup success] because it’s all experience. How do you know about markets? How do you know where to look? How do you know how to manage people? How do you know how to manage finances? All of these things require experience. You aren’t born with management skills and finance skills and knowledge of markets. All of this comes with experience and experience comes with age.

There is a very strong VC bias [against older founders]. It is one reason why the VC system itself is in trouble. VC is becoming less and less relevant to innovation. Also, if you look at the data on the returns that venture capital is producing, the returns are dismal.

My advice to the older workers, and to women, is screw the venture capitalists. Just bypass them. Go and build it, and they’ll come. The power is shifting.

So why are VCs getting it so wrong?

Insight is better than hustle

Somehow it has become a truism in startups that “hustle is everything” and that founders can hustle their way to success.

In a recent blog post, author and entrepreneur Tim Fargo exposes the hustle myth. He points out that his business growth has come from “solving a problem that lots of people care about. That insight has proven much more valuable than the myriad hours of work I put into my old business. Hustle gets [a] beating.”

Don’t get me wrong, hustle, hard work, and discipline are necessary to build a great company. But an inexperienced “hustler” chasing after the wrong market has a high likelihood of failure.

Relentlessly pursuing a business with the wrong team, hired as a result of inexperience, isn’t likely to produce a winning company either.

By focusing on the right customer with the right product, and building a company with the best team, entrepreneurs can build amazing companies and simultaneously create great lives for themselves and their employees.

Experience leads to efficiency

One of the best examples of working efficiently and effectively on a customer problem, rather than working all hours of the day and night comes from Lew Cirne, founder and CEO of New Relic.

Cirne had founded and sold his previous company and was working on a new idea that ultimately became New Relic. He was in his late 30s and had a young child.

In committing to starting a company, I did not want that to be at the expense of a full and complete family life. 

I was very thoughtful about [this] from the beginning. So when I started the company before I had a Series A, the ground rule I had was [that] we’re going to look for a more experienced employee base, capable of doing more in a shorter period of time, and is less likely to burn out.

And the other thing I thoughtfully put into the culture is I make a habit of leaving the office at 5 o’clock every night because one of the important things to me is dinner with the family, and I like to cook the dinner, and it is just a routine I have. Compare that with [other Silicon Valley companies], down the street, much younger companies, they have catered dinners.

Lest anyone think that Lew Cirne was building a “lifestyle” business, New Relic is now a public company with a $1.4 billion market value and $200 million of annual revenue.

Dave Mariani, CEO of AtScale, did raise his venture round by breaking through the “blue flame” nonsense. VCs were impressed that AtScale was generating real revenue, managing their cash, and built a team with great internal “chemistry.”

“Wow, you have experience,” VCs told him.

Imagine that.

Rob Kornblum is a startup consultant, a former venture capitalist and Kauffman Fellow and a former startup executive. Reprinted by permission. 

SEE ALSO: Women are more likely to engage in risky sexual behavior after 3 drinks — and other data about booze and sex

SEE ALSO: These resumes for Donald Trump and Hillary Clinton prove you never, ever need to use more than one page

Join the conversation about this story »

NOW WATCH: Scientifically proven features men find attractive in women

Alphabet executive chairman Eric Schmidt has outlined what he sees as being the ideal startup in five years' time.

Schmidt says a key quality of a future successful tech company will be a reliance on crowdsourced data. He gave the example of a company that sources data about skin cells and then uses machine learning to process that information.

A good company would "use Android, iOS, and machine learning but use the crowd to learn something trivial," Schmidt said onstage at Startup Grind Europe on Wednesday.

One hypothetical that Schmidt provided was a dermatology company funded with $1 million (£700,000). He suggested that the company could pay dermatologists $1 each for information on skin cells and the problems they had and then use machine learning to develop a recognition system that could take an image of a skin cell and diagnose a problem.

"You could sell that service to dermatologists because it's more accurate than an individual diagnosis," he said. "That model is a highly likely candidate to become a $100 billion (£70 billion) corporation."

Elsewhere in his onstage interview, Schmidt heaped praise on the British startup DeepMind, which Google acquired in 2014 for $500 million (£352 million). Schmidt said DeepMind was "one of the greatest British success stories of the modern age."

Join the conversation about this story »

NOW WATCH: How to find Netflix’s secret categories

European technology companies valued at over $1 billion (unicorns) are starting to outperform their US counterparts, according to research from investment bank GP Bullhound.

The continent's unicorns generated an average of $315 million (£215 million) in revenue over the last 12 months, while America's generated just $129 million (£88 million).

Manish Madhvani, managing partner at GP Bullhound, said in a statement: "Europe has yet to reach the dizzying heights of American giants such as Facebook and Google, but when you look at businesses in the $1 billion (£683 million) to $3 billion (£2 billion) range, what we lack in quantity we more than make up for in terms of quality.

"All the data points towards a stable, maturing market that has avoided the excesses of the US in favour of sustainable growth. We are seeing a remarkable resilience in European technology markets."

The investment bank also claimed that Europe's unicorns are "healthier" than US unicorns when it comes to valuations. US unicorns, which have raised twice as much capital than European unicorns on average, are valued at 46x the size of revenue generated, while Europe's are valued at 18x.

Further, European unicorns are more likely to be profitable than US unicorns, with 60% of the continent's billion dollar tech firms in the positive. This is "well above" industry standards according to GP Bullhound.

There are a total of 47 unicorns in Europe, according to GP Bullhound, with 18 in the UK, seven in Sweden, six in Germany, three in France and three in Israel. Unicorns can also be found in Switzerland, Luxembourg, and Denmark.

Speaking at the NOAH Berlin tech conference earlier this month, Oliver Samwer the founder and CEO of German unicorn Rocket Internet, described Europe as a collection of "mini Silicon Valleys" that the continent should be proud of.

Europe's most valuable technology company is Spotify, which was valued at over $8.5 billion (£5.8 billion) in a funding round that was closed in June 2015.

Madhvani added: "There has never been a better time to operate within the European market. I firmly believe that the right ecosystem exists for one of the companies highlighted in this report to push forward and reach a $10 billion (£6.8 billion) valuation in the next few years, and over time a $100 billion (£68.3 billion) valuation."

The report — titled "European Unicorns 2016: Survival of the Fittest"— focuses on European technology companies with an equity valuation of $1 billion that were founded in 2000 or after.

Join the conversation about this story »

NOW WATCH: This unconventional keyboard is a must-have for power-programmers

London startup space provider Techspace has raised £5 million to help it expand its coworking business to Berlin and build out its UK operation.

The company — founded by entrepreneurs David Galsworthy (CEO) and Alex Rabarts (CTO) in 2012 — raised the money through a consortium led by real estate investor and entrepreneur Leo Noé.

Techspace provides flexible coworking space designed for fast growing technology companies as well as larger, more established businesses like Virgin Media and Business Insider UK. It boasts over 1,000 members from more than 50 businesses.

The company currently has five coworking locations across London but the Berlin location will be Techspace's first overseas outpost when it opens towards the end of this year in the city's Mitte district.

Techspace said its Berlin site will boast approximately 20,000 square feet and enough room for up to 300 members. It added that prices will be in line with how Techspace positions itself in London, where memberships go from £315 per member per month up to £9,800 per month for an enterprise. 

In Berlin, Techspace will be competing with local startup space provider Factory Berlin as well as the likes of WeWork, which is arguably the largest coworking space provider worldwide. The latter opened up its first outpost in Berlin earlier this month.

Berlin's tech scene has taken off in the last few years and the city is now home to a number of well-known startups, including food delivery startup Delivery Hero, music startup SoundCloud, and startup builder Rocket Internet.

Index Ventures investor Timm Schipporeit told Business Insider in Berlin earlier this month that he expects Berlin to overtake London as Europe's biggest technology hub within the next few years.

David Galsworthy, CEO and cofounder of Techspace, said in a statement: 

Coworking has already grown exponentially over the past few years. There’s been a huge, global shift towards flexible, collaborative workspaces, particularly in technology. We empower our community to focus solely on growth and innovation, leaving workspace considerations to us. This investment will enable us to continue supporting tech companies in their growth beyond being startups, develop our offerings in London and also expand to Berlin - a destination that makes perfect sense given the city’s established reputation as a hub for technology innovation.

Full disclosure: Business Insider UK is a Techspace tenant.

Join the conversation about this story »

NOW WATCH: Bumble founder: Here's what's seriously wrong with the growing trend in Silicon Valley called 'brogramming'

Jean-Louis Gassée, a former Apple executive and a columnist for the tech and business blog Monday Note, has an unusual piece of advice that he likes to give to the startup founders and entrepreneurs that he occasionally advises:

When you're pitching a VC, pay attention to their stomach.

No, not to decide whether or not you should ask for their workout tips. But because if you do, you will notice the subtle shifts in their muscles and posture that indicate when they want to say something.

That's when you know to shut up, Gassée tells Business Insider.

Pausing to let someone speak or ask a question instead of making them interrupt you impresses your audience and makes startup pitches more effective for all parties. It turns it into a conversation instead of a presentation, and can help surface the best questions.

Gassée's other piece of advice: If you're bringing a pitch-deck, then make it as dead simple as possible, with all the most important information on only three slides.

SEE ALSO: The tongue-in-cheek way the women of Google are responding to a shareholder's sexist comment

Join the conversation about this story »

NOW WATCH: Sorry Apple fans — the iPhone 7 is going to be boring

The UK's AI scene is once again the talk of the town following the sale of Magic Pony Technology to Twitter for a reported $150 million (£102 million).

Twitter isn't the only US tech giant acquiring UK AI startups, with several other significant exits over the last few years.

Evi was acquired by Amazon for a reported £18 million in 2013, DeepMind was bought by Google for around £400 million in 2014, VocalIQ was acquired by Apple for an unknown amount in 2015, and SwiftKey was bought by Microsoft for £175 million in 2016.

The Oxbridge-London triangle is playing an important role in the creation of the UK's best AI companies, according to LocalGlobe investor Saul Klein. Oxford, Cambridge, Imperial, and UCL all have deep expertise in applied mathematics, computer science, and machine learning. Indeed, several of Britain's best-known AI companies started off as research projects within these institutions before being spun out. Evi and VolalIQ began at Cambridge, for example, while DeepMind has close ties to all four institutions.

Universities like Oxford, Cambridge, Imperial, and UCL all have deep expertise in applied mathematics, computer science, and machine learning. Indeed, several of Britain's best-known AI companies started off as research projects within these institutions before being spun out. Evi and VolalIQ began at Cambridge, for example, while DeepMind has close ties to all four institutions.

But AI startups aren't just being created within the walls of academia.

Magic Pony Technology — founded by Zehan Wang and Rob Bishop — was born at Entrepreneur First, which is a company that helps deeply technical people to find cofounders they can launch a tech startup with.

At least half of Entrepreneur First's last cohort focused on machine learning, which is a type of technology related to artificial intelligence that involves a computer teaching itself different processes without someone telling it what to do.

The sale of Magic Pony Technology to Twitter is a major boost for Entrepreneur First, which has been gaining momentum over the last few years as an increasing number of big-name investors look to back the companies that are created through its six-month programme. Entrepreneur First cofounder Alice Bentinck, who was recently awarded an MBE for services to business, said in a statement on Magic Pony's acquisition:

"For us, Rob and Zehan’s story is a striking reinforcement of why the Entrepreneur First model works, why we bet on individual talent first, and why we bet on hard technology. We believed that for people like Rob and Zehan, going to work at an investment bank or a big company – for a long time the default path outside Silicon Valley for ambitious people – was a terrible waste of their potential.

"But, before Entrepreneur First, if you didn’t already have a team, an idea, and a product, no investor or accelerator would talk to you, so the path to becoming a founder was closed to you. Today, this announcement proves that not following the status quo when it comes to starting and building companies that solve complex technical problems yields rewards."

While the Magic Pony exit is likely to be seen as a positive step for the UK AI scene, it does raise questions about whether the UK will ever be able to produce a really big AI company if Silicon Valley keeps preying on the country's most promising startups.

Join the conversation about this story »

NOW WATCH: Switzerland spent $12 billion to build the world's longest and deepest train tunnel

The “adjustment” phase for private tech companies is beginning, and startup founders are starting to deal with the implications of falling valuations.

“For the public companies, the adjustment has happened. For private companies, it’s just beginning,” Byron Deeter, a partner at prominent VC firm Bessemer Venture Partners, told Bloomberg.

For a startup facing a declining valuation, there are a few options. The leadership can raise a “down round” at a lower valuation; accept “dirty” terms on their next round, which extract concessions that can lead to trouble down the line; or seriously consider acquisition. They could also try to claw their way toward profitability.

“There’s been a little denial, just like at the start of drug-addiction treatment programs,” Deeter said. “Now we’re rolling into the coping-and-reaction phase. For some, the best option may be entering into [mergers and acquisitions] discussions.”

Microsoft kicked off 2016’s M&A by buying LinkedIn for $26.2 billion ($196 per share). But expect to see late-stage startups getting in on the action. Bloomberg spoke to an M&A exec at a big US tech company who recently has had “at least four” meetings with late-stage founders about an acquisition. Last year, the founders were asking prices that were too high to even warrant a meeting, the exec said.

But the winds have changed in 2016.

SEE ALSO: The inside story of the 10-year struggle to get Netflix's 'Making a Murderer' on your screen

Join the conversation about this story »

NOW WATCH: These animal sculptures are made from empty bullet shells

China Renaissance CEO and founder Fan Bao meets a lot of startup entrepreneurs.

He has provided mergers-and-acquisitions advice and underwritten initial public offerings for some of China's hottest startups. He also works with venture capitalists to help them identify top pre-IPO companies for investment.

He has advised on the $1.78 billion US listing of the Chinese e-commerce company JD.com, the $286 million public offering of the microblogging app Weibo, and the merger of the ride-hailing rivals Didi Dache and Kuaidi Dache.

When searching for a great startup, Bao says, the most important thing to pay attention to is the entrepreneur behind it.

"Early-stage development is probably all about the entrepreneur, or 90% about the entrepreneur," Bao told Business Insider in a recent interview in San Francisco. "Even if the idea is somewhat less than perfect, he'll somehow figure out a way to make it perfect."

A good startup needs an entrepreneur who's the right match for the task at hand.

"You have to understand what the job entails and you have to understand the individual, whether there is a match," Bao said.

He provided two examples:

"If you do a social network, the entrepreneur better be young, the same generation as the users, a great product guy, have unique insight into the users and the needs and wants of the users, and be really passionate about the stuff he is doing. He's not just making the product, creating a company, making a little money, but he truly believes his product can help his folks, or her folks, to make things differently. So that's one.

"But if you're an enterprise guy, you're probably a bit older, and you need to be able to manage a pretty large engineering team. And the thing about enterprise is you have to sell. So the best enterprise entrepreneurs we have seen are more sales-y types, like coming from a selling and marketing perspective as opposed to a product-development perspective."

The biggest challenge, he said, is gauging these things while many entrepreneurs have no real experience.

Inexperience does not deter Bao, however. The youngest entrepreneur his firm advises is 21.

Join the conversation about this story »

NOW WATCH: A global intelligence analyst explains why the ‘real’ China is not the China we think of

We share cars through Uber and Lyft, and homes through Airbnb. Why not do the same with luxury watches? 

Two-year-old startup Eleven James has made that idea a reality. Founded by ex-NetJets exec Randy Brandoff, the company basically operates like Netflix used to, back when its primary business was sending you DVDs via snail mail. 

After filling out your profile, you select a membership plan, and then hop on the phone with an Eleven James "concierge" for a welcome call. After that, your first rental watch will be mailed to you in two days. When your time with that watch is up (usually 3 to 6 months, depending on the plan), you send it back and receive your next one.

There are a few different membership tiers, starting at $150 and going all the way up to $800 a month. The more you pay for an Eleven James membership, the more expensive the watches you can access. The name itself is a reference to the man whom Brandoff calls the prototypical Eleven James member: James Bond, the spy who's always equipped with gadgets.

SEE ALSO: Why luxury watches cost so much money

DON'T FORGET: Follow Business Insider's lifestyle page on Facebook!

Brandoff got the idea for Eleven James while working for NetJets. As the CMO of the Berkshire Hathaway-backed private jet chartering and partial ownership service, Brandoff was often surrounded by a wealthy clientele. 

What did this well-heeled group of people have in common? They all loved watches, just like Brandoff himself did.

"My taste for variety far exceeded the rational budget I could allot to [watch collecting]. You no longer have to buy all these other asset classes to enjoy them, but you have to buy watches," Brandoff said, in reference to luxury experiences like flying private. "I would be a consumer of an alternative model, and I'm not such a unique luxury consumer."

Once Brandoff's family gave him the green light, he left NetJets and Eleven James was born.

It's important to note that Eleven James only deals with high-value, well-designed, connoisseur-level watches with old-fashioned mechanical internals. They're for people who appreciate what goes into making a watch.

Eleven James has a watch collection in "the eight figures," according to Brandoff. This includes all of the most popular and most respected luxury brands, like Rolex, Patek Philippe, Audemars Piguet, IWC, Tag Heuer, Tudor, Breitling, and more, including vintage models.

Brandoff said that every watch will eventually exit the collection and end up on a member's wrist permanently through full ownership. By handing watches back in on time and in good order, members accrue points that can be used as currency toward buying a watch from Eleven James.

To service these watches, the company has partnered with a trusted New York City-based watch repair service that has been scaling as Eleven James grows.

"We didn't set out to be the country's biggest watch repair service," Brandoff said.

Starting a business is hard no matter where it begins. Some locations, though, can make it easier to grow that business into a successful company, thanks to a combination of culture, talent, technology, and capital. 

On Wednesday, Dell unveiled its 2016 Women Entrepreneurs study. The survey examined which cities would be most supportive to "high potential women entrepreneurs"— women who are building a business to surpass $1 million or more in revenue a year.

Most cities still have a long way to go to fully support the woman entrepreneurial community — the No. 1 city only scored a 'mediocre' score of 58 overall — but some places stand out from the pack.

Here's the list of the best cities for a high potential woman entrepreneur to start a business:

SEE ALSO: 15 brilliant or just plain crazy quotes from eccentric billionaire Elon Musk

19. Sao Paulo

The Brazilian city got high marks for the city's "attitudes and expectations" toward women entrepreneurs, yet its access to capital is holding it back.

18. Mexico City

Better access to female mentors and role models would "go along way" for Mexico City, the survey said.

17. Tokyo

The Japanese city placed at the top of the list for market size, but it could do a better job helping women entrepreneurs access the market and find female role models.

When Yahya Mokhtarzada found out Gogo inflight Wi-Fi had been sneakily charging him $40 for months, he decided to build a startup to make sure you’ll never get ripped off by a subscription again.

That startup is Truebill, which Mokhtarzada launched in February with his brother, Idris, who previously cofounded a startup that sold for $117 million.

The concept of Truebill is simple: a single unified system that manages all your subscriptions, from your gym membership to Netflix, and helps you cancel them if you need to.

The subscription future

Mokhtarzada thinks you will have more and more subscriptions in your life moving forward, and that means you’ll want a service to keep them all straight (and find new ones). He points out that popular software like Adobe Photoshop and Microsoft's Office suite have moved toward subscription models, as have entertainment mainstays like Netflix and Spotify. Truebill's research showed that users had doubled their number of subscriptions over the last 18 months, Mokhtarzada says.

Mokhtarzada's pitch for a subscription-filled future has proved compelling to 45,000 Truebill users so far. 25% of those have canceled at least one subscription on the platform, and have saved over $400 per year by doing so, Mokhtarzada says.

Now Truebill, which is backed by prominent startup incubator Y Combinator, has announced a $1.4 million round of seed funding from investors including Social Capital, Sherpa Ventures, and ITA Software founder David Baggett.

With the money, Mokhtarzada says he hopes to build a platform that does four basic things:

1. Tracks which subscriptions you currently having.
2. Helps you cancel them (hopefully with one click).
3. Helps you find and buy new subscriptions using recommendations and one-click ordering.
4. Lets you manage and personalize subscriptions that allow you to adjust things like frequency.

Mokhtarzada's 7-person team also plans to launch iOS and Android apps in the first half of July.

The end of bad subscriptions

While Mokhtarzada was initially driven to build the platform because of his fury at Gogo, he says sneaky subscriptions are very much part of the "old paradigm" of tricking customers. Most of the newer services try to make it easy to cancel, with Netflix as a prime example, he says.

That’s one reason why Mokhtarzada sees a lot of the value in Truebill residing in discovering new subscriptions. And it helps that referral fees for discovery are Truebill’s eventual path toward revenue.

But right now, helping you easily cancel annoying subscriptions is one of Truebill’s perks. Sometimes that even means writing a certified letter on your behalf, as was the case with a gym Truebill ran into. There isn’t a charge for this, and more complicated procedures are sometimes completed by Truebill employees, though the goal is to automate as much as possible.

"Gyms are just ridiculous," Mokhtarzada adds.

As to the most canceled subscriptions, Mokhtarzada says credit monitoring services and background checks are the ones that most often get the boot.

Check out the platform for yourself at its website>>.

SEE ALSO: The story of how Stanford mocked its founding father by voting to change its mascot to the 'Robber Barons'

Join the conversation about this story »

NOW WATCH: Scientists just discovered the youngest planet ever found

Don't be surprised if a friend nudged you on Facebook this month to download the app Kiwi.

The social Q&A app has been on a tear, hitting number one on the app store rankings in early June and staying in the top 20 apps since. 

However, many Q&A apps that have been hot before ultimately ended up failures. Here's how Kiwi thinks it has a different way to beat the ghosts of anonymous apps past:

SEE ALSO: These 19 cities are the best places for women to launch a succesful business

In June, the Q&A app Kiwi hit No. 1 in the App Store, displacing even apps like Snapchat and Instagram. Since then, it's stayed in the top 20 apps overall in the US. But what makes it so hot?

Kiwi goes beyond a Q&A app for friends and lets you ask or answer questions from anyone, even anonymous people. There are some basic questions like "What are you listening to right now?" that have thousands of responses from people listing the music they like. Newer questions on the app range from potato chip preferences to how old someone looks.

When you first sign up, you can either connect it to your Facebook or create a whole new account. Be careful if you're using your Facebook though or you might unintentionally spam your friends into joining!

A few miles east of Manhattan, in Astoria Queens, a suite of residential buildings that house millennials and retail stores was recently purchased for $60 million.

But it wasn't a traditional real estate transaction. The 20 investors weren't private equity funds; the property wasn't even listed by a big brokerage firm. And the entire process, from the day it was listed to time it was completed, took a matter of weeks rather than months.

The four-building property was listed on Cadre, a 40-person startup that has been quietly working out of the Puck building in Manhattan's Nolita neighborhood since late 2014. There, a team of former Square, Google and Facebook executives have gathered to shake up the real-estate world.

One hire was apparently so important to Twitter that CEO Jack Dorsey is said to have flown to New York to try and reverse the employee's decision. The employee stayed at Cadre.

The team is led by a 27-year-old former Goldman Sachs, Blackstone and Harvard alumn, Ryan Williams, who has attracted a team of high-profile investors and advisors. Over the past year and a half, Cadre has raised $68 million from Peter Thiel's Founders Fund, Goldman Sachs, Alibaba founder Jack Ma, DST's Yuri Milner, real-estate moguls Jared and Joshua Kushner, and others. Advisors include TPG's co-CEO Jon Winkelreid and SL Green's president Andrew Mathias.

Cadre is a platform where approved sellers ("operators") can apply to post carefully vetted commercial real estate deals, from stores to apartment buildings to offices. A network of high-wealth individuals or "qualified purchasers" who want to make real estate investments — but haven't previously had access to deals — can drop $500,000 or more on individual properties. Currently, all of Cadre's listed properties are located in the US, but the startup plans to expand internationally.

"If I said to you, 'How would you go about buying that building over there?' You'd probably say, 'I don't know,'"

If I said to you, 'How would you go about buying that building over there?' You'd probably say, 'I don't know.'

 Williams explained Cadre's opportunity to Tech Insider. "If you do know, it's probably because you know a fund. But even then, if you were able to get to that building and that fund, then how do you see what's going on with your investment?"

To invest in real estate, wealthy individuals typically need to invest in a real estate fund, which then makes all the decisions on which buildings to invest in, without providing many details to the backers. The investors' money is then tied up for five to seven years, with no opportunity to sell their interest in the meantime and no real-time updates are provided.

Cadre's vision is to offer an alternative that makes the real estate market more like the stock market. People can purchase portions of a specific building, the same way they can choose a specific company to buy stock in. Cadre investors can't currently sell their positions at any time though, but that may change in the future.

"Fundsare opaque and you don't have a good sense of what's happening underneath the hood," Williams said. "Cadre's mission is to create a more efficient economy where we can connect the world's buyers and sellers in opaque assets that have been inaccessible to many."

How Cadre's platform works

On Cadre, the platform looks like an e-commerce store — just with price tags ranging between $50 million and $250 million.

When you click on one of the buildings, you're taken to a beautiful landing page full of stats and information that's presented like a baseball card, with a transaction overview, executive summary, the purchase price, how much equity is available, a dynamic FAQ section and more.

For sellers, Cadre is an opportunity to get a deal done relatively quickly and cheaply — if your property is accepted (only about 1% of everything Cadre's team vets gets listed on the platform). Cadre has less overhead than many funds, and thus Cadre says it can charge sellers about 50% less in fees. 

"The typical fee model is, there’s an element of a double promote, or a 'carry,' like 2 and 20, that a larger fund would charge," Williams explained. "Then there’s carry that an operator would charge. At Cadre we’re basically eliminating the 2 and 20 that happens at the fund level."

"2 and 20" means funds typically charge investors 2% in annual fees and then 20% of any profits in exchange for access to the deals and management of their assets. 

Once you've found an appealing Cadre property, the investing process is quick. Cadre asks how much money you'd like to invest, and the member plugs in an amount ranging from $500,000 to tens of millions. Williams says most of its 100 or so members have invested in two or three properties on Cadre, and the platform has already closed hundreds of millions of dollars in total volume.

Cadre then asks who you are investing on behalf of, yourself or an entity. If it's an entity, is it one in the US and is it tax exempt?

Then the investor requests allocation. Within a matter of weeks, they'll hear back from Cadre on the approved amount they can invest in the deal. Sometimes it's less than the investor wanted; historically, Cadre says its deals have been over-subscribed.

But if a listing does start to struggle, there's a backup plan. Cadre is partnered with an unnamed family office in New York City (Williams says it's not Trump) that gives Williams' team access to $250 million to guarantee funding on the platform.

Tech Insider was able to view a slightly outdated version of the Cadre platform in the company's headquarters, but Cadre declined to share screenshots for this story.

The CEO who's grabbing top talent from Google, Square and Facebook

Williams is a Louisiana native who has always been entrepreneurial. When he was twelve he started a sports tech company and sold it during his freshman year at Harvard, where he met his Cadre co-founder, Joshua Kushner.

Kushner is also the cofounder of health insurance startup Oscar and runs a startup investment firm, Thrive Capital. His brother Jared Kushner, who owns the New York Observer and runs his family's real estate business Kushner Properties, is the third Cadre co-founder.

In college, Williams started a real estate business that used technology to track homes as they came to auction. He ran that business on the side in the late 2000s, while he worked full-time at Goldman Sachs. He later joined Blackstone's real estate private equity group. 

In 2013, Williams discussed the idea for Cadre with Jared Kushner. The Kushner brothers became his first investors and advisors.

The Kushners and Williams believe Cadre's opportunity is massive. It's easy to imagine the platform expanding to other tiers of investors and to other financial services.

"Cadre is building a technology platform that democratizes investing in an asset class that has traditionally been incredibly difficult to access," Joshua Kushner told Tech Insider in an emailed statement.

"I think that’s going to be a trend you see moving forward — big industries from heath care to financial services, to the political world have been controlled by a few large players, and tech will evolve to completely revolutionize them," Williams explained.

"Real estate is one of the last frontiers ... This is not a startup with a niche consumer focus. This is fundamentally an opportunity to transform the buying and selling experience."

He added, "We’re chipping away at these gatekeepers who haven’t really been pushed yet."

SEE ALSO: Google's latest adorable robot can load your dishwasher

Join the conversation about this story »

NOW WATCH: MICHAEL MOORE: 'I think there’s an excellent chance' Trump will be president

Marcela Sapone and Jessica Beck hatched the idea for Hello Alfred while they were at Harvard Business School, and found that working grueling hours wasn’t conducive to keeping their apartments clean.

The apartments were a total mess, Sapone tells Business Insider.

So the pair decided to take to Craigslist and hire someone to do their laundry, buy groceries, and complete all the other errands they just never could get around to doing.

The concept stuck, and eventually the pair cofounded Hello Alfred, a concierge startup where its employees run your errands for you. Alfred’s basic service costs $32 per week, plus the cost of goods like groceries, and is handled through its smartphone app.

The company has seen revenues triple in the first half of this year, according to Sapone.

Branching out to buildings

While the initial rollout of Alfred focused on signing up individual consumers, Sapone says the company has started a new phase of its business, one that signals the bigger plan for the company. Alfred has begun to sign up whole apartment buildings for its service.

Since Alfred's founding, Sapone says she's been obsessed with “density.” Density of customers is how you make a business like Alfred's work, and scale, she explains. Sapone says Alfred has a huge waitlist, but that the company has constrained its growth to focus on making sure its unit economics are solid.

Signing up entire apartment buildings is a way to supercharge that density of customers.

One of the first companies to offer Alfred as an “amenity” in its buildings is Ollie, a micro-apartment and coliving “specialist.” Ollie recently announced plans for a 301-apartment property in Los Angeles, touting a basic subscription to Alfred as one of the amenities.

Ollie cofounders Chris and Andrew Bledsoe tell Business Insider that they always knew they wanted concierge-level services, and actually started out talking to more traditional ones. But Alfred made the compelling pitch: a lot of things a traditional concierge services does, like ordering cars and making reservations, are easy to do on your smartphone. Alfred would step in for things your smartphone couldn’t do.

Ollie decided to enter into a partnership in which its apartments are serviced once a week by an Alfred employee. Residents can upgrade the account if they want to, but the basic service is free.

Another Alfred partner is Related Rentals, a luxury apartments company, which announced its Alfred partnership on Facebook earlier this month.

Sapone says these partnerships are a piece of a much larger expansion plan, and something that has been in the works for quite some time.

It was in Alfred’s first pitch deck, she says. Alfred, so far, has raised $12.5 million from investors, including Spark Capital, New Enterprise Associates, Sherpa Capital, and CrunchFund.

Using Alfred

So once Alfred is in a whole apartment building, or a single home, what do its employees actually do?

The basic service is easy to understand: groceries, laundry, tidying up, and so on.

But when I tested the service, what I found most useful were the random chores I had been putting off. My Alfred (Eli) assembled a photo array for me and hung it on my wall, fixed a shirt button, bought me a power strip, and cleaned a wall that had gotten dirty.

When these chores are within reason for what an Alfred could accomplish in a weekly visit to your house, you don't get charged. The tasks I asked for all fell under the basic service, though a Bloomberg writer who had Alfred resell 90 books was charged for this. If Alfred has to subcontract the job or do a lot of additional work or travel, you’ll be billed. Otherwise, you'll just be charged the cost of the goods (the power strip, for example). You can also discuss the amount of work one of your requests will require with your Alfred beforehand using the app, which I did a few times.

My requests weren't unusual for Alfred users. These are the most common tasks Alfred is asked to do, according to Sapone:

• TV mounting
• Hanging pictures
• Window cleaning
• Shelf mounting
• Patio/outdoor cleaning
• Furniture assembly

My biggest problem with the service was that once I had my Alfred to do all the chores I’d been too lazy to do, I felt like the service was less valuable for me. I live one two blocks from a laundry place and three blocks from a grocery store. I don't have prescriptions to fill regularly or parcels to have Alfred drop at the post office. While I appreciate that these tasks might be more burdensome or pressing for others, they just aren’t for me. Those recurring tasks weren’t compelling for my life, as it stands today.

But I will say the main benefit to Alfred was that I simply didn’t have to think about keeping my home in order. When I remembered some tidbit I needed to buy sometime in the near future, I put it on my list, and it appeared. Since I don’t completely destroy my house every week, Alfred’s tidying was more than enough. I just didn't have to make time for those things, or worry.

That feeling isn’t worth $32 per week to me at this point in my life, but it was tangible. And if it were a free amenity in my building, I certainly wouldn’t say no.

Additional reporting by Maya Kosoff. 

SEE ALSO: Netflix CEO: 'Trump would destroy much of what is great about America'

Join the conversation about this story »

NOW WATCH: This scientist thinks Elon Musk is wrong about the threat of artificial intelligence

David Krane describes his investment in Uber as the "relentless pursuit of a guy that's hard to pin down."

In the early days of Uber, back when it was still a black car service, Krane realized that he was using the company with great loyalty and great frequency — traits he looks for when making new investments.

So, he set out to track down Travis Kalanick, Uber's CEO and cofounder, and spent two years working on building a relationship with him.

"Thankfully, the company's capital needs opened up long before I lost my patience and ran out of enthusiasm for chasing him, so it worked out beautifully," Krane, a managing partner at GV — formerly known as Google Ventures — told Business Insider.

Except Kalanick wanted something very unusual at the time: one investor to fund the entire round.

"And he wasn't looking for $10 million, he was looking for way more than that," Krane said.

The amount Kalanick wanted was around $250 million, and Krane had to convince his partners at GV that Uber was worth the price and the risk to the fund.

"By simply running that analysis about sticking a quarter of a billion into one company, it is totally unconventional. It's such a concentrated piece of exposure," Krane said.

But having worked for Google since 2000, Krane preaches that you can't resign yourself to accepting what's known and old. That company is all about moonshots and experiments. And when Krane looked at Uber's numbers, he found himself looking at a company that was on the same path as the early days of Google.

In his seven years of venture-capital investing, he says that he's never seen any other company with growth charts like it.

"Uber and Google share so much in common from that perspective, it's just amazing. It was like looking in a mirror," Krane said. "We knew how the story of Google played out, and it gave us further confidence that the story of Uber would be the same."

GV went on to lead the 2013 Series C round for Uber, meeting that the price that Kalanick wanted, although two other investors also participated to bring the round's total funding to $361 million. Since then, Krane's enthusiasm for the company is undeniable and has only grown.

Even GV's big risk now pales to Uber's most recent $3.5 billion round from Saudi Arabia's sovereign-wealth fund.

Krane said:

"The company hasn't been without tension. It's had extreme amounts of scrutiny, frankly more scrutiny than I think a company of its age should have or even deserve to have. Has it facilitated some of that attention? Absolutely. Is it deserving of all the scrutiny it gets? Absolutely not. This company is growing like no other."

SEE ALSO: Uber will stop showing the surge price that it charges for rides

Join the conversation about this story »

NOW WATCH: These are the best, highest-paying companies in America

"Trampolines are scary. And it's worse the higher you bounce," says former world-class trampoliner Adrien Sommier, who was once ranked No. 2 in Europe.

Trampolines are also dangerous. They cause nearly 300,000 injuries a year, researchers say.

But trampolines are also wildly fun.

Sommier says that jumping on a trampoline and running a startup are very similar.

He founded a company called Amplement in France in 2013. It's an online collaboration site that hopes to replace Slack, Skype, Microsoft Office/Google Docs, and LinkedIn.

In other words, it's a free website where people can chat with others publicly, privately, and in groups, make video calls, search and get job offers, and — soon — work on documents together.

It launched first in Europe and has about 500,000 users, adding 700 a day, a representative says. This week, the US edition launched and 5,000 people signed up in the first 24 hours, he tells Business Insider.

Most people would call Sommier crazy for trying to take on such big established players all at once. And maybe he is.

But as a competitive athlete in a super-dangerous sport, he says that the naysayers just make him work harder. He wakes up at 4 a.m. and stays at the office until 10, he says. So he's got motivation.

Ultimately, he says that jumping on a trampoline is like running a startup:

"It's easy for a novice to look at the ground after they jump. But doing that throws off your balance, ruining your technique and even inviting a rough landing. You have to center yourself around where you are, and focus on nothing but having the perfect form. An entrepreneur's risks are just as frightening. But thinking about the dangers won’t protect you from them. You have to commit to your vision 100%."

Whether his startup flies or crashes, there's no question that he's aiming high.

SEE ALSO: Sergey Brin: Don't come to Silicon Valley to start a business

Join the conversation about this story »

NOW WATCH: We tried a trampoline fitness class — and it was much harder than we expected

When Rachel Mayer left her job as a trader at JPMorgan, she realized just how good she’d had it with access to financial data.

Mayer left trading to pursue a master's in computer science, but she was still watching the markets and wanted to invest her own money.

The problem was that the tools she had relied to make investment decisions at JPMorgan were out of her reach, and those available to her as a civilian retail investor were limited (to put it politely).

This frustration led Mayer and two classmates to set out to build a platform to level the playing field, slightly, in favor of everyday investors, cofounder Adrian Soghoian tells Business Insider.

That work has become Trigger, an iPhone app that provides free realtime data for investors.

Here's how it works. Trigger lets you set up different financial “triggers,” which you can then use to guide your investment decisions. An example: You can set a reminder to sell a stock when it reaches a certain level, moves a specific percentage, hits a one-year low or high, and so on. When the condition occurs, Trigger sends you a notification, and you can decide whether to act on it.

But Trigger doesn’t just track the stock market. It has four basic types of economic signals, Soghoian explains:

1. You can set up alerts based on the performance of certain stocks.
2. You can have Trigger track US economic events like the jobs report.
3. You can set up a trigger around corporate earnings.
4. If you link your brokerage account, you can schedule alerts based on gains or losses in your portfolio.

Soghoian hopes these signals will help everyday investors create disciplined trading strategies. If you're checking the stock market every second and firing off trades, you risk letting emotions dictate your decisions. Thinking through your plan beforehand pushes you to act in a more measured way, Soghoian says.

That doesn’t mean some retail investors won’t lose their shirts in the stock market, but Soghoian sees Trigger as a both a democratizing and rational influence, as opposed to one that just breaks down barriers to trading. It encourages you to think.

Trigger also has ambitions beyond the consumer market. The startup plans to license its API to other companies: a brokerage, for instance. These companies could rebrand Trigger and offer it as a feature to their customers. And while Soghoian says Trigger's basic service will likely remain free for individuals, institutional access and special features are where the startup hopes to make its money down the line.

Some of these special features might be access to more exotic data sources, Soghoian explains. Trigger is hungry for more data.

Soghoian says the team wants to expand the number of data streams available, as well as release the ability to string together signals for more complicated “compound triggers” (which should be available on the app within a few weeks).

Check out Trigger for iOS here, or visit its website.

SEE ALSO: These 13 Google Chrome hacks will change the way you use the internet

Join the conversation about this story »

NOW WATCH: You can modify your iPhone's logo so it glows like the one on your MacBook

A couple years ago, investors were begging to put their money into many startups, and startups were happy to comply.

But that has started to change, says GV (formerly Google Ventures) managing partner David Krane. 

"First half of last year into the summer, it was very common for a series B entrepreneur to walk in and put their hand out and ask for $50 million or something Herculean like that," Krane told Business Insider.

"I’d say those meetings are the exception, not the norm now."

Krane got used to seeing early startups raise more than $10 million in their earliest rounds, even if they hadn't found a product/market fit, built a complete team, or even finished engineering the product. 

"Traditionally, those kinds of milestones would be much more mature before a company would secure $10M in funding," Krane said. 

That pace of investment has changed in 2016 so far. Those 'Herculean' sums aren't being raised as much and the valuations have petered out as well. CB Insight noted a second straight quarter of declining investment to startups. As for the creation of "unicorns", only five companies reached billion-dollar valuations in the first quarter of 2016, compared to 25 new unicorns in Q3 of 2015.

"I think there’s been a healthy-resizing of expectations on both sides of the table and I think it’s still early in terms of some of the corrective outcomes that are inevitable as a result of some of the excitement and the hysteria of last year," Krane said.

For one, companies that are trying to get from seed funding to a Series A might miss a now much higher funding bar, he predicts.

"There are a lot of people who are having trouble getting to the other side of that bridge if you will. I think that expectations across the board are much higher for what defines a company that is Series A fundable than say a year ago," Krane said. 

The funding crunch has forced companies to be more creative in order to survive. Some are taking down rounds, while others are repricing previous rounds or even resorting to a full recapping of the company.

Krane is bullish that some companies will find an M&A exit if they need one, but otherwise he's advising GV's companies to be smart on cash:

"You’ve got to keep investing in the business and anticipating and growing where appropriate, but I don’t think you can keep playing this game where you spoil yourself with excess or competing with your neighbor down the road that offers six free meals a week when you only offer four....I think companies that were distracted and spent on the wrong thing ...will certainly not be able to show the numbers that will be able to earn them additional equity. And in turn will be faced to consider debt, or even worse, have to fire sale a business or shut a business down. "

SEE ALSO: To the early Google employee who invested $250 million in Uber, seeing Uber's growth is like 'looking in a mirror'

Join the conversation about this story »

NOW WATCH: These businesses profit off your laziness

Great businesses can be launched any time, even when there's a downturn in funding.

While the start of 2016 might have spelled trouble for some well-established startups, it also saw the birth of companies tackling things like a cure for cancer, superfast internet, and competition for Uber.

Business Insider spoke to founders and venture capitalists and took a look at funding data to identify some of the startups that had the biggest starts in 2016. Some names on the list are officially launching out of stealth, while others are still in their early months of forming a company.

Here are 17 of the top startups to launch so far in 2016.

Did we miss the next big thing? Leave us a note in the comments.

SEE ALSO: These 19 cities are the best places for women to launch a succesful business

Starry is making more powerful Wi-Fi for your house.

What is it:Launched in January by the former CEO of Aereo, Chet Kanojia, Starry will sell wireless equipment that will deliver supercharged internet speeds up to 1 gigabit per second. That's fast enough to download a two-hour movie in a just a few seconds.

Starry makes a receiver called the Starry Point that hangs out your window like an antenna. You can hook up your own wireless receiver or use its own Starry Station, a $350 device that can tell you right from its screen how fast your internet is performing.

Funding: Unknown, backed by FirstMark Capital, Tiger Global, IAC, KKR, HLVP, and Quantum Strategic Partners.

Website:https://starry.com/

Juicero wants to make the freshest juice you've ever tasted.

What is it: Simply described as the "Keurig for juice," the three-year-old startup finally launched out of stealth in February. The product is a smart, Wi-Fi-connected kitchen appliance that presses pouches the size of IV bags into tasty concoctions of fresh fruits and veggies. There's no preparation, mess, or cleanup — you simply slip in the pouch, press a button, and out pours your juice.

It starts at $699, a price tag that has drawn criticism about the young startup, but its investors believe the price will decrease as the company matures.

Funding: More than $100 million from Campbell Soup, Google Ventures, Artis Ventures, and Kleiner Perkins, with additional funding from Two Sigma Ventures, First Beverage Group, Acre Ventures, Double Bottom Line Ventures, Thrive Capital, and Vast Ventures, among others.

Website:https://www.juicero.com/

Cheddar is betting it can be the new CNBC for millennials.

What is it: Jon Steinberg, former president of BuzzFeed and CEO of Daily Mail US, founded Cheddar to present business news with a twist for millennials. Now using a paywall, the company has short clips of its interviews for free but is hoping business-savvy 20-somethings will pay to have news tailored to their interests.

Funding: $3.1 million from Lightspeed's Jeremy Liew, Homebrew, and Vivi Nevo.

Website:http://www.cheddar.com/