Month: March 2008

  • LearnHub.com launches – Teach and Learn Online

    learnhub_logo_100×48.pngJonas and I dropped by the Savvica offices today for the launch of LearnHub.com. LearnHub is the first site from Savvica since their funding in the fall of 2007. We previously covered the return of Savvica’s founders, John and Malgosia, back to Toronto after a year in San Francisco. Savvica is based in Toronto and recently took significant investment from Indian e-learning company Educomp.

    LearnHub TeamLearnHub is in many ways the evolution of their first product, Nuvvo, which was a much more traditional learning management system. LearnHub on the other hand has a lot more social networking functionality and the “community” model feels a lot more engaging.

    Users can connect with other people, can join communities and can help build courses in those communities by bundling tools such as “Debates”, “Lessons”, “Tests” and “Discussions”. There is also an explicit “Authority Ranking” in LearnHub that rewards users who participate more regularly and in more ways.

    Once you have built a course, you then have the option of charging for it. LearnHub becomes a marketplace for online courses where experts in a subject area can quickly and easily build courses and then make money by charging for them. There is a lot of potential here if LearnHub can get enough exposure and adoption inside the right communities. They then also have to attract a mass audience who will pay for these courses.

    By running their own support site as a community on LearnHub, Savvica is eating its own dogfood. The support site gives the best demonstration of how a community can be structured and how the different components of the community can be used differently.

    In talking to the John and Malgosia, it became obvious that this is just the beginning of their long-term strategy. Without giving away the secret sauce, I can say that I was happy to hear that their revenue model was much more mature than you might assume up front.

  • Ontogenix raises funding from GrowthWorks

    GrowthWorks LogoOntogenix, based in Toronto, has been developing its patent pending social media ad serving technology for the last 3 years. Things are looking up, earlier today we heard Ontogenix landed a substantial round from venture capital fund GrowthWorks and strategic investor Pareto Corp (TSE: PTO).

    The company was founded in 2005 by Amit Kanigsberg (former Pareto CTO), Josh Mozersky (Queen’s University Professor of Logic), and Daniel Veidlinger (California State University Professor of Linguistics). As part of the funding round, Ontogenix is bringing on serial tech entrepreneur Chetan Mathur as Chairman and industry expert Marc Ruxin (SVP Digital Strategy & Innovation for McCann Worldgroup in San Francisco) as a board member.

    Ontogenix is raising the round to go to market with their first product, an Interest Correlation Engine. The technology is designed to increase the relevance of ads presented on social media sites (e.g. Facebook, MySpace, etc.) by targeting users based on their individual interests. The company searches for information on the general public’s interests, attitudes, and opinions on hundreds of publicly available sources such as social networks, blogs, and forums. This information, collected in aggregate to preserve user privacy, is then combined with the company?s proprietary data model to form the basis for a predictive engine that can tell advertisers which ads will have high relevance to different types of users.

    A number of companies are gunning for this market including Lookery and Lotame. In pilot tests, Ontogenix was able to increase click through rates by 400%. With Google publicly expressing remorse for the $900M guaranteed ad deal with MySpace and Facebook being lambasted for their Beacon program, it is high time someone figured out a better way to serve ads on social networks; we’re hoping it’s a Canadian startup.

  • Always Be Audacious – Otherwise you are just boring

    You know the drill. You have a good idea, you are pretty excited about it. Sure, you would be lying if you said you had it all figured out, but you are smart enough to know you have something.

    Then it starts. All of those joe-shmoe monday morning quarterbacks start doling out advice. Time after time, you get the same advice: “It’ll never fly”.

    Let me tell you something, unless the best of the best are telling you that, then you should just turn away. Any successful startup has to start with an audacious idea. If your idea isn’t just crazy enough, it will never amount to anything special.

    Audacious

    1 a: intrepidly daring : adventurous

    2: marked by originality and verve

    My favorite startups have all started on the crazy side of nutty. You can look at the now-established former starts that began as simply out there ideas. Amazon.com was going to sell books, by mail order, via the internet, in 1994. I can promise you, more than a few people probably rolled their eyes when Jeff Bezos pitched them.

    At about the same time, eBay was planning to build a marketplace for what ended up being millions of people and Google reinvented something we thought was a well served market.

    The dream is audacious, not the product

    Your vision is what must be audacious. If you can’t make me step outside my comfort zone, help me dream in to the future and to see a world that needs what you are building, then I just won’t get excited.

    The flip side of that is that your product, the thing you are building, must be pragmatic. You have to understand your immediate market and why they are going to buy from (or use) you now.

    Keep marching

    The reality is, if you believe you have a great idea, then you are the only one who can prove yourself right or wrong. Everyone else is just watching from the sidelines and helping out where they can. The burden to perform is on your shoulders.

    The difference between your bright idea and a the ideas of a dozen other people is that you will get down to it and deliver. Build the product, test the market, sell. GOTO 10

  • Angel financing – Due diligence

    In this article I will talk about the due diligence process that angels go through in order to assess if they will invest in your company. At this point let’s assume you have made your investment pitch to a group of angels. Recall when I spoke about the overall investment lifecycle, when you make your pitch presentation your main goal is to get people interested enough in the investment opportunity of your company to want to spend the further time required to go through the due diligence process.

    After you have made your pitch, the angels that are interested in your company will form a due diligence team. The usual next step is to schedule a follow-on meeting between your management team and the interested angels. At this meeting you will have a longer period of time (a few hours vs. the 20 minutes you had for the investment pitch) to discuss your company, answer angel’s questions, etc. This will allow the angels to get a more in depth understanding of your company and determine the areas they want to focus on during the due diligence process.The process, depth, timeframe for a given due diligence investigation will vary with each specific circumstance and the angels involved. However, in general angels will want to assess the main areas of your company: management, product, market opportunity, competition, and go to market strategy.

    At a minimum you should have the following documents prepared to feed into the due diligence process:

    • Business plan
    • Past financial statements / future financial projections
    • CVs of management team
    • Shareholders agreement
    • Patents
    • License agreements / supplier contracts

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