Apr 23, 2012

DEMO Conference 2012 Review: Consumer Startups

I attended the Silicon Valley DEMO conference last week. This was my second DEMO and feel it’s a great conference to get an overview of the emerging trends and companies. Over two days, 81 startups demoed their products in 6 minutes each. The creativity and diversity of companies is often amazing – both in geography and in the problems they tackle, ranging from the everyday frustrations of an average consumer (e.g., DealAngel, Eva) to the needs of special groups such as architects (e.g., Archability) or business professionals (e.g., Voxeet).

Here are some thoughts on a few consumer startups that I found interesting as an end-consumer.

Apr 16, 2012

Why Tagtile, not Instagram, might be more Strategic for Facebook

Facebook bought two San Francisco mobile startups last week. Much has been written about the Monday deal - Instagram, which is probably the highest acquisition price ever paid per employee ($77M!) I suspect the Friday deal – Tagtile – was probably two or three magnitudes smaller than the first one. However, it might be a more long-term strategic move than the first one. 

Why? A strategic acquisition is something that helps you enter new markets. Google acquired YouTube for $1.65B, instantly giving them ~50% market share in a new category (despite Google Videos experiements). SAP acquired Sybase to be the market leader in enterprise mobile market. Instagram deal could very well make sense as bolstering mobile and increasing engaged users or probably avoiding an acquisition by Twitter or Google. Either way, it does not help Facebook enter a new category, whereas the Tagtile deal can get Facebook into an entirely new multi-billion dollar market by connecting the social/ mobile commerce world with the massive offline retail commerce (and potentially later into mobile payments). The approach might be similar to the Google Android deal: buy a small player and scale with the big company resources to be the market leader. Let's not forget that Android was a small acquisition of an 8 people company in 2005 that later built the Google mobile strategy (Fortune article here).