StartupNorth

  • How to Hire Me, A Technical Co-Founder

    There has been a lot of buzz the past 6-8 months about hiring great technical co-founders. The implication seems to be that being a non-technical co-founder is a handicap of sorts and that CEOs buy sandwiches before the product is finished. Apparently coding & building great products is hard, but running the business is easy. Here are some articles:

    Why You Can’t Recruit a Technical Cofounder
    Quora – Technical Co-Founders
    Please, please, please Stop Asking How To Find a Technical Co-Founder
    Thoughts On Hiring a Technical Co-Founder

    I am a “technical co-founder” at Peek – I code, keep big scale systems up, hire & fire, set dev processes, and all that other technical stuff. So let me tell you about how I got recruited into Peek by Amol Sarva, @amolsarva.

    Sell Vaporware

    Amol had one VC committed to Peek in our A, and had a letter of intent from Target (yes – www.target.com – that Target) to sell Peeks nation-wide, in-store in the US. The status of the “product” – he had a carved out a wooden model of the Peek (ala Palm)!! And these deals were huge – a $15mm A round with half committed. Target – nation-wide for Christmas 2008!! These days I hear too much crap from “deal guy” founders about finishing product before doing deals. Lame. Be a stud – go sell vaporware. Go get real customers who pay you real money. Go find partners and distributors. I have seen countless, great sales guys in my life sell smoke and mirrors. Why can’t you?

    This guy hired me

    Hire Other Studs

    Amol had recruited John Tantum, former President of Virgin Mobile USA, as our chairman. He had an all-star marketing & retail guru lined up. Our advisory team was the president of BlackBoard, SVP strategy at Intuit, and the former head of the FCC. No matter what, I knew I was going to learn and have an awesome experience working with some great folks.

    Be Generally Awesome

    Amol was an interesting guy in general. He had a PhD in Philosophy from Stanford. He was/is building a new property in Queens. He took a photo that hangs in MoMA. The blog I write on is startupnorth, the “blogs” he writes on are Salon & Business Insider. Being generally impressive is important. The important question here is the Peter Thiel question, why is employee #20 going to come work for you? The weight of the CEO’s personality and accomplishments matter here. Senior guys will want to know the accomplishments of your business as well as the accomplishments of your management team. You have to be generally awesome enough to bring people in if you aren’t one of those super red hot, Twitter-esque companies.

    Be Top Amongst Your Peers

    Amol, while starting Peek, was mentoring other founders. He was one of the original members of Founders Roundtable. His peers looked to him for advice on starting a company.

    Now, I know this is a bit of a love-in of Amol. And it also probably feels like a pretty high bar. All you have to do is go get a PhD, raise $15mm and get a distro deal done with the second largest retailer in the US before you can hire great technical co-founders.

    Not quite. The main lesson is this. Forget your technical co-founder and realize that the “product” is one aspect of your business. Potentially an important one (also potentially a complete waste of time you need to pivot off of). You need to start consistently proving that you can make this business successful without having a “heroic engineering, product only” mindset. Can you on a day-in, day-out basis creatively solve the problems of the business such as acquiring customers faster/cheaper, reducing churn, recruiting great folks, financing the company’s goals, having great customer service, delivering everything on-time, getting great advice, navigating treacherous competitive waters, and so on and so forth. Can you relentlessly out-execute with or without the crutch of great product and fabulous engineering? The way you have built the business pre-launch tells me a lot about how you will run the business post-launch.

    If you can do stuff like Amol did, you’ll be fine. If you are buying sandwiches… sorry, go find someone else.

    I’d love to hear from other founders (technical or not) on how they both built their company pre-launch and how they found their technical co-founder.

  • Zynga Acquires Toronto’s Five Mobile – And I am Going To Embarrass My Now Rich Friend

    I know we re-tweeted this story from another source already, but I have a good personal connection to this company and I wanted to use this forum for something.

    To start, here is the post from Zynga:

    “Zynga is crossing the border! Today we are excited to announce a new addition to the Zynga family, the Toronto-based Five Mobile team. In addition to the team, Zynga is also acquiring certain assets and Intellectual Property developed by Five Mobile. Five Mobile, now Zynga Toronto, creates compelling, robust and scalable mobile applications. The team has worked closely with some of the largest media and technology companies in North America across a multitude of platforms and handsets. This talented group will focus on advancing multiple initiatives within Zynga mobile. Mobile industry veterans and Five Mobile founders Ameet Shah, Jeff Zakrzewski, Oliver Tabay, and Troy Hubman will all join the Zynga team. Ameet Shah will head up our Zynga Toronto studio and report up through our Zynga mobile team, led by David Ko.”

    Five Mobile was totally bootstrapped, no investment… making money from day one. So whatever money or stocks they are getting from Zynga, it is all theirs!!!

    And now for my startup lesson of the day. There is a downside of getting bought by a big company like Zynga who are going public and getting rich while all your start-up friends struggle in their daily survival. Your petty friends, former classmates & colleagues who write on blogs will get you back by posting embarrassing pictures.

    The Guy To The Left Of Me Is Now Rich

    I’m the guy holding the log in the air in the picture. Jeff Zakrzewski, Managing Partner at Five Mobile, is to the left to me. Us CS nerds were always mad that the pink tie somehow became our symbol (and possibly we were a bit jealous that engineers had a much cooler tool and hard hat). So we, the graduating class of 2002, decided to replace the pink tie with the Math faculty’s lesser known symbol, The Natural Log. (I still wonder if graduating classes followed our lead after that night). That is Jeff proudly wearing his “%100 Natural Log” t-shirt. We were on our 4th or 5th pub and perhaps 40th or 50th beer.

    So big congrats to Jeff (@jeffz), Ameet (@ameetshah) and everybody at Five Mobile. It does seem to be a magical year for Canadian companies, and I’m happy to know some of them personally. One day I hope Jeff tells the full story of Five Mobile because it is a model example on how to build a service business – rising out of the ashes that was Tira Wireless shutting down, creating a company that made great mobile apps with great service (Peek and I were one of Five Mobile’s first customers), going bootstrap the whole way, and selling it to a big hot company like Zynga. Congrats guys!

  • Why Wasn’t BackType Funded in Canada?

    This is a cross post from Mark Evans Tech written by Mark Evans of ME Consulting.

    BacktypeFor those of us who work in the Canadian social media and startup circles, there was some celebrating earlier this week when BackType announced it had been sold to Twitter.

    Lots of credit goes to founders Christopher Golda and Mike Montano, who have made BackType one of the leading services to track and analyze social media activity.

    Without raining on the BackType parade, a question that begs to be asked is whether BackType should have been funded in Canada as opposed to the U.S.

    To provide some background, Golda and Montano were electrical engineering graduates from the University of Toronto, who showed their entrepreneurial chops by starting a service called iPartee. While the business didn’t succeed, Golda and Montano proceeded to start BackType in 2008 as a way to search for blog comments.

    To jump-start the business, they applied and were accepted into Paul Graham’s YCombinator startup program in Silicon Valley, which coughed up $15,000 for a 6% in BackType. This let Golda and Montano create a prototype they could pitch to investors. Over the next three years, BackType raised $1.3-million and expanded into Twitter search.

    In hindsight, BackType is a big fish that got away from Canadian investors. I would hazard to guess that in 2008 getting seed capital from Canadian investors was a remote possibility for Golda and Montano, which is likely one of the reasons they applied for the YCombinator program.

    The question is whether BackType would get funded today in Canada. It appears the seed and startup investment landscape has changed with the emergence of new funds such as Real Ventures. Meanwhile, there has been a growing number of startup acquisitions, which should bolster the confidence of investors and entrepreneurs.

    Do Canadian investors now have the ability and willingness to finance smart entrepreneurs with ideas? Or do Canadian investors still need to see traction such as a finished product, customers or revenue?

    For more on the BackType story, check out this TechVibes story.

  • Win $5000 – Kik Launches In-Phone SDK and Competition

    In February this year, Fred Wilson wrote a great piece about the need for mobile app “glue” (my words). Here is the exact phrasing:

    “When I was at the music hackday a few weekends ago, I noticed that it was easy to build something interesting by simply snapping together a few web apps and then building some light glue between them. I suspect it will be even easier to do that on mobile and the era of “meta apps” that deliver functionality across multiple apps is upon us. And I think that has the potential to create some new startup opportunities.”

    Well, Kik has become one of the first gluemakers. Read their blog post – The Kik SDK: Build Real-Time Sharing into Your App in 10 Minutes.

    Kik has provided a device resident SDK so that application developers can build sharing into their apps. It is such a powerful idea – sharing done on the device. Until now, if a mobile app developer wanted to do sharing, that capability had to be basically hosted “in the cloud”. Think about picplz & instagram. They have had to use Facebook, Twitter and other “web” platforms, and connect to them via some cloud servers. Well, with Kik’s SDK, mobile apps can now share “natively” on their mobile platform. No more cloud – huzzah!

    ‘Everything is better with friends’ By giving your users the ability to share with each other in real time, your app will be that much more fun and compelling (see the Sketchee story below). Sharing can also give a big boost in adoption – when a user who doesn’t have your app receives a Kik content message from it, Kik offers to take them directly to your download page where they can install it. All of a sudden you aren’t asking your users to share your app with their friends, but to share content from your app with their friends – content that requires them to get your app to view and interact with it. It’s the difference between inviting someone to join a social network vs. tagging a photo of them that requires them to join the social network to view it. And best of all, it will only take you 10 minutes to add this kind of functionality to your app.

    On top of all that, Kik is giving away $5000 to each of the top three applications built on their SDK. Finish your app by August 8th and you can get in on that.

  • Under the Hood – Chango

    I am always curious at what startups are using for the technology under the hood. It helps define the technologies that frontend and backend developers looking for jobs might start using. It helps understand what skills are being developed in the ecosystem and where competition or coopetition for talent may exist. And I am always curious at the emerging trends of technology adoption by local firms.

    I have enjoyed the coverage of the technology at Toronto-born startups like BackType and the work of the team at BostonInno (in particular Kevin McCarthy’s The Tech Behind) and Phil Whelan in Vancouver. Dan Morel (@dpmorel) has started looking at the development processes used at Canadian startups (see: Supersize your Startup Dev Productivity & One is the Loneliest Number). If you are a Canadian startup that is building “interesting” technology, we’re actively looking for startups to profile.

    Chango

    We start the series with Chango and technical Q&A with Chris Sukornyk (LinkedIn, @sukornyk) and Mazdak Rezvani (LinkedIn, @mazdak) looking at the technology and the evolution of Chango platform. Chango closed $4.25MM in a Series B financing round led by Rho Canada and included iNovia Capital, Metamorphic Ventures, Extreme Venture Partners and others. The Chango team has doubled over the last 6 months, they are roughly 25 people (including Hot Sh!t List member Josh Davey).

    The online advertising landscape is changing rapidly, Chango is taking advantage of Real-Time Bidding to allow marketers to buy ads on the web in real-time. It means big data where time is critical because small fluctuations in price or users can have big impact on the overall effectiveness or cost.  The best analogy is a stock market, where instead of stocks, marketers can buy billions of ads each day based on how they think that websites ad slots will perform for them. The cool part about RTB is that you can combine data to put the right ad in front of the right user. This requires huge data processing skills and Chango processes information on about 60,000 ads a second.

    What does Chango do?

    We are an ad-buying platform that is built for online marketers looking to find new customers using display (banner ads). Our main goal is to eliminate wasted marketing dollars through smarter targeting. Specifically we show ads to people based on what they’ve searched for in the past – a technique we are pioneering called “Search Retargeting“.

    Unlike traditional ad networks we exclusively buy ads using real-time bidding, a new technology that is rapidly changing the Display advertising industry and allowing marketers to layer data on top of their media buys.

    Chango is unique in that it has access to billions of search terms, billions of incoming ad impressions, and has devised machine learning techniques for combining data from different sources to deliver more efficient and better-targeted campaigns for our advertisers.

    What does your product architecture look like?

    Software development that deals with “Big Data” typically has two types of challenges: big volume, or low latency. Chango has to deal with both of these issues simultaneously.

    We receive over 90,000 requests per second (and growing monthly) from our ad exchange and data partners at peak times of the day. To make matters more interesting, we have approximately 80ms to respond to any incoming bid requests. Unfortunately 30-50ms of this limit is used up because of unavoidable network latency, this leaves us only 30ms to process each bid request. As a result, we have to constantly optimize our bidder subsystem around this challenge.

    What are some of the tools and technologies you use?

    Open Source is at the heart of our technology stack. Python is the common thread that binds all of our subsystems. Our entire infrastructure is written in Python. We use a (modified version of) the Tornado Web Server for our realtime servers, and Django for the front-end.

    When dealing with super fast response times it’s critical to have a super-fast datastore at your disposal. That’s why we use a NoSQL database technology based on the proven memcached server.

    The unsung open source hero of our infrastructure is HAProxy. HAProxy handles our load-balancing across the board. We use the “keepalived” feature of Linux to keep these servers in high-availability mode.

    As far as our architecture is concerned we try to not have any major dependencies on any specific features of the third-party systems we choose. They just happen to work well for our current environment.

    How did you get here?

    Scalability is as much an art as it’s a science, but most importantly, it’s about keeping things simple. It took years of hard work, and careful tuning and measurement to arrive at where we are.

    Originally we used Java for all server-side development and Ruby on Rails for front end development. The thinking was that we needed a rock-solid language for server architecture and a rapid development environment for front-end work. This concept served us well for a little while; however, in early 2010 we realized that Java was drastically slowing down our ability to iterate quickly and effectively. A single feature was taking days to build, test and deploy.

    We bit the bullet and rebuilt the platform entirely in Python and it was probably the best decision we ever made. Not only do we have a consistent language across front end and server side development but it has enabled us to rapidly add features or test new ideas. We are fortunate to have access to the fantastic ecosystem created by the Python community.

    Where do you host?

    Our first approach back in 2009 was to leverage Amazon Web Services EC2 as a scaleable and cheap way to prototype the platform. That served us well for a while; however, the shared virtual environment meant that we had wildly variable server resources.

    We shifted to Hosting.com knowing that we ultimately needed our own equipment and if we wanted a VM environment we would need to set one up ourselves. While Hosting.com provided good support at the time we wanted the rapid provisioning we were used to at EC2 with the power of dedicated hosting.

    Ultimately we chose SoftLayer as our hosting provider of choice. SoftLayer offers a VM environment in addition with their “express” service that allows us to get 10s of new servers provisioned in about 3-4 hours! They have been extremely good about allowing us to occasionally provision a whole new parallel cluster as we do capacity planning.

    How do you monitor your systems?

    Monitoring is done through a combination of Nagios, PagerDuty, and Circonus among others. We have also built a real-time data visualization system that let’s us monitor both infrastructure, and campaign performance. We use this dashboard as our own NOC system hooked up to a TV that is mounted right in the engineering area!

    What are your biggest development challenges?

    We’ve got two distinct challenges. Our real-time, data processing, and systems engineering teams deal with problems of scalability and big data. As our business continues to grow, we need to re-examine our infrastructure and design choices. We have a very healthy culture of team collaboration, code-review, and refactoring.

    Our Dashboard team has a different set of challenges. Our self-serve ad platform is very much like Adwords in that marketers can put down a credit card and launch a campaign themselves. We need to make this an extremely user-friendly system, while keeping it powerful enough to enable people to perform sophisticated reporting and campaign optimization.

    How do you win?

    The Chango business is all about putting the right ad in front of the right user at the right time. We made an early decision that data you know about a user (ie. search data) is only effective if it is combined with a proprietary bidding engine that can make decisions in real time.

    Almost every DSP, data provider or ad network out there today does this by storing information about users in a client-browser “cookie”. They call this a user segment. The problem with user segments is that they are pre-computed and stored within the users browser. If you decide half way through your campaign that you need to adjust your audience (due to lack of performance) there is no way to do so since the information is hard coded in the users browser. The only option is to continue serving ads to this under-performing group of users and wait for that cookie to expire (typically 30 days).

    At Chango we’ve decided to make everything real-time, including our decision about who to bid on, and how much to bid. Nothing about the user is pre-computed. So the Chango ‘cookie’ contains nothing more than a unique identifier that anonymously points to all the raw data we know about that person in our database.

    Chango is hiring!

    Python Developers! There are multiple open positions in Toronto, New York & San Francisco. But if I could have anything it would be talented developers that either know python or want to learn Python.

    Interested in being profiled in our Under the Hood series, we are actively looking for Canadian startups building “interesting” technologies and solving “interesting” problems. Contact me by completing your initial Under the Hood submission.

  • Supersize Your Startup Dev Productivity


    AttributionNoncommercialShare Alike Some rights reserved by Dav

    Since I wrote the interview with Farhan of Xtreme Labs on Pair Programming, I have exchanged a number of emails on pair programming & developer productivity with some of Canada’s best developers. Most of them are pure gold that I am posting raw and unedited.

    ———————————————————————————————

    “The main thing we like to stress on development is Test Driven development. We just find that it both ensures all the code is well tested, but also guides the architecture in a way that really improves maintainability. We use pairing in our interview process and also like to pair for the first couple of weeks to get developers up to speed, but after that we tend to split up work for the day and then attack separately.” – Jesse Miller, CEO of attachments.me

    ———————————————————————————————

    “Whether to use pair programming or alone model really depends on the team personality and the kind of culture the leaders want to shape up. Some people do work better alone, and some prefer more teamwork.

    Personally, I usually value teamwork more than individual results. At the end of the day, individual work will have to be integrated to form the end product, which is what really matters. There are too many examples where people think they got great ideas, but end up in epic failure during implementation. It is a result of not doing deep enough design validation. Coding alone is definitely more effective when you got the design details flushed out. Personally, when I am coding alone, I still ask for 2nd or 3rd opinions on a day to day basis. It forces me to think through the design again and again, which helps to refine my idea further. It is all about attitude. Never believe that you got it right until see the end product.

    Another interesting thing is “pair troubleshooting” is more effective. When you’re trying to debug in an extremely stressed environment, it is always good to have some mental support and another pair of eyes.” – John Yuen, heads up dev for Fixmo

    ———————————————————————————————

    “I think that pair programming does actually increase productivity, in most cases, and there are two reasons for this:

    1. It keeps programmers from doing other things:private email, browsing, day dreaming, etc. I doubt that the average programmer actually spends even 50% of their time doing their job. If you can hire two developers, and get the work of one full programmer out of them, then I think, in a lot of cases, that would be an improvement. However, you could get almost the same result by pairing each
    programmer with their own full-time low-cost supervisor who sits beside them to make sure that they’re actually working. This would be a lot cheaper and almost as productive, but the developers would find it insulting. This isn’t always the case of course; there are certainly many self-motivated, disciplined, highly-focused and productive developers who don’t need supervision.

    2. Studies have shown that programmer productivity is limited, not by the time it takes developers to write code, but by the time it takes them to detect and correct errors. The limiting metric isn’t lines-of-code-per-hour, but rather, errors-debugged-per-hour. This is why Java is more productive than C++, despite the two languages being of similar expressive levels, Java’s runtime exceptions make it quicker to detect and recover from many times of errors, and garbage collection completely eliminates many other types. This is where pair-programming comes into play, if someone looking over your shoulder can spot an error as soon as it’s created, then that can lead to a lot of time savings. Maybe it would have only taken you two minutes longer to detect and fix a particular bug, but then gain, maybe it would have taken a week. Your partner wouldn’t need to early-detect very many problems in order to justify the overhead.

    Maybe one developer sitting in a control booth, like a security guard, monitoring the work of half-a-dozen developers all at once, would be a good compromise between pair and pair-less programming.

    Yes, it’s true that ACM programming contests are performed on only one computer, but you rarely have more than one person working on the same problem. While one is typing in and debugging their solution, the other programmers are working with pencil and paper solving their own problems (with occasional help from their team mates as required).

    People are more important than any process or any tool. The best process is to hire the best people and a better developer is the best tool.

    I half agree with what the original article says about hero developers. They say that you don’t need them, and that you’re better off with the a consistently productive 9-to-5’er. I think they’re
    confusing heroes with heroics. I think that you do need heroes, but you don’t need the heroics of pulling all-nighters. Instead, you need the heroics of consistently creative and proactive problem solving which keeps you efficient, effective, and ahead of the game, day in, and day out. Effort should not be confused with results. I think they have the wrong definition of heroics, which leads to the wrong definition for heroes.” – Kevin Greer, Framework Lead at Redknee.

    ———————————————————————————————

    Point #2 from Kevin Greer’s comments is widely unappreciated. Most people judge productivity by features and the “to do” list – when in reality it is not the to do list of features that usually makes projects late, it is the killer game of bug squashing, especially as you get to the stressful end of project delivery. Processes that reduce the upfront bug rate or increase the bug solving rate, even at the expense of adding features pay off quickly. This is were pair programming, test driven development, code reviews, architecture chats, etc all come into play. And why “pair troubleshooting” or other tools to debug problems fast are important. And also, use the damn debugger, it is there to make solving bugs faster.

    I’d love to hear from more of the programming community in the comments. Tell us how you supersize your development productivity.

  • National Survey of Canadian Angel Group Activity

    Snow Angel by Syymza

    Today, the National Angel Capital Organization (NACO) released statistics regarding Canadian Angel group investment activity in the Investment Activity by Canadian Angel Groups: 2010 Report.

    This study looked at the ‘visible’ portion of the Angel investor community – those that are members of Angel groups – as it is almost impossible to survey the entire Angel community. Different countries estimate the visible Angel community represents between 3% (US) and 12% (United Kingdom). Understanding this,  the findings presented below represent only a fraction of the actual Angel investment across Canada. They do, however, provide us with the most accurate snapshot of the activity in the community that we have today.

    Significant findings of this report include:

    • 90% of companies funded by Angel groups in 2010 were new, not follow-on.
    • Angel groups collectively received around 1,850 business plans. 14% were considered in detail, 32% received investment.
    • Angels groups invested CAN$35.3 million in 88 deals; an underestimate as some groups did not report the amount invested.
    • Co-investors were involved in 58% of investments and invested at least a further CAN$29.4 million.
    • Angels invested in a wide range of industries but with a strong technology focus: ICT sector (43%), Life Sciences (18%), and Clean Tech (16%).
    • 74% of funded businesses had revenue in 2010.

    Download a copy of the full report here: http://www.angelinvestor.ca/2010_Investment_Activity_Report.asp

  • BackType acquired by Twitter

    Backtype has been acquired by Twitter

    Congratulations Christopher Golda (@golda) and Michael Montano (@michaelmontano) on Twitter acquiring BackType. We’ve written about BackType since their acceptance in YCombinator (fortunate that we didn’t give iPartee their previous startup too much attention). This is another amazing acquisition of Canadian startups by a Silicon Valley company (make it 16 acquisitions since Jan 2011 see TechVibes). I think Dan was right, this could be a $1B year for Canadian startup acquisitions.

    The BackType team had already relocated from Toronto to San Francisco. And it looks like the relocation to the Twitter offices should be much easier:

    Our team’s relocating to the Twitter office. We’re very excited to not only join an amazing company that’s changing the world, but to continue building products in pursuit of our shared vision with Twitter.

    Finally, I’d like to thank all our investors and advisors, especially Y Combinator, Toni Schneider and True Ventures, Josh Felser and David Samuel from Freestyle Capital, Manu Kumar, Chris Sacca, Raymond Tonsing and Seth Berman.

    What is amazing/disappointing is that there are no Canadian investors along side the group of amazing investors assembled by Chris and Michael.

  • Week in Review

  • Emerging Market Opportunities

    So I just finished a big tour de Southeast Asia. There is really only one story going on over there – Mobile. Check out this research from BCG (BRICI = Brazil, Russia, India, China, Indonesia):

    • 1.2B new internet users coming from BRICI countries by 2015
    • Mostly coming from mobile, much of that will be advanced feature phones (not smart phones)
    • Social in Indonesia & Brazil, Email in India, IM in China (QQ FTW!!!)
    • That will only result in 20% internet penetration in those countries (i.e. lots more to come!)

    All of this is happening here and now. There are huge opportunities for any mobile startups to break into these countries. Let me give you a taste of Indonesia.

    Two years ago Nokia had 60% of the phone market. A retailer called Nexian had just started up with the idea of importing and reselling Chinese manufactured phones and branding them as Nexian phones.

    Fast forward to today. Nokia is down to 30% of the market!!! Nexian is one of the dominant retailers, they just sold to the Spice Mobile family (large conglomerate in India exploding across Asia, Middle East and Africa). You can get a stylish QWERTY phone with a big display with pre-loaded apps including email, Opera Mini, Facebook, Twitter, Mig33, Nimbuzz IM, private messenger, widgets, news reader, etc, all for < $40 (in some cases closer to $20). You can also get a Nexian Android phone for $150-$200. [caption id="attachment_9327" align="alignleft" width="640" caption="This Bad Boy = $20"][/caption]

    Everybody is ripping off Nexian’s go to market strategy. The telecos have launched new brands to sell these phones. The retailers have gone to China, sourced phones and are re-selling them. The Chinese manufacturers have opened up retail in Indonesia (Huaiwei has their own stores!). On top of that I counted at least 20 Nexian clones, small companies with the same strategy as Nexian.

    Blueberry Probably Outsells BlackBerry 2:1 In Indonesia

    Nexian has countered by offering apps & services on these $20-$40 phones. People don’t have data plans, so Nexian does micro-billing via the carriers. 10c/week for Facebook, 5c/day for IM, $3/month for chat as examples. It works, they make millions a month from it.

    There are roughly 170M phone users in Indonesia.

    For Canadian startups, this means that there has never been a better opportunity to build mobile apps and “go global”. Check out if your app has a competitor in markets like Indonesia. All these phones in Indonesia (and China and India) are on a single platform with a single OS -> MediaTek. Port your app to MediaTek and go get deals with any of the manufacturers, the Nexians and their clones, the operators, etc. You can either try and get a royalty up front with your app pre-installed on the phone, or you can work out a rev share agreement on the service, or whatever other monetization scheme you have in mind.

    There are plenty of folks who can help you with local business development. For instance, if you are a mobile app startup and you think Indonesia looks hot, Andy Zain runs the Indonesian Mobile Monday and Founder’s Institute. He is incredibly well connected in the teleco scene and he has helped startups like mig33 and Payfone (you are also free to reach out to me for contacts and info as well). In every country there are guys or companies like him. A bit of research and networking and you can find them.

    Next week I’ll have some more on the start-up scene in Singapore, including some info from the leading startup blog over there (sgentrepreneurs.com).