On sales. And how much to charge.
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iLoveRewards closes $4.7million Series A
Here is a company worth talking about.
iLoveRewards took a big problem and found a quirky and economical solution to it. This is the kind of company had me gushing 10 seconds in to the pitch. I’m sure that John Albright and company saw it from a mile away.
ILoveRewards is sort of like one of those midway games that pumps out tickets every time you get the ball in the middle hole.In the case of iLoveRewards, employees of a company can earn points for things like good attendance, hitting sales targets or customer satisfaction. As these points build up, the employee can redeem them through iLoveRewards.
Todays announcement is that JLA is contributing an additional $1.5 million to the round which will be used to create a US-focused brand for the service as well as to finance more sales and marketing initiatives.
iLoveRewards competes with more established companies such as another favorite of mine, SuccessFactors, and I have no doubt that the competition will be moving to copy some of the novel things that iLoveRewards has been doing.
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30 Ideas that need to be Funded
Paul Graham has published Startup Ideas We?d Like to Fund at YCombinator.
- A cure for the disease of which the RIAA is a symptom
- Simplified browsing
- New news
- Outsourced IT
- Enterprise software 2.0
- More variants of CRM
- Something your company needs that doesn?t exist
- Dating
- Photo/video sharing services
- Auctions
- Web Office apps
- Fix advertising
- Online learning
- Tools for measurement
- Off the shelf security
- A form of search that depends on design
- New payment methods
- The WebOS
- Application and/or data hosting
- Shopping guides
- Finance software for individuals and small businesses
- A web-based Excel/database hybrid
- More open alternatives to Wikipedia
- A buffer against bad customer service
- A Craigslist competitor
- Better video chat
- Hardware/software hybrids
- Fixing email overload
- Easy site builders for specific markets
- Startups for startups
It?s a great list for entrepreneurs to start thinking about what to build next. The best part is that a number of folks have been building this software in Toronto, Vancouver, Montreal and other places in Canada. Here is my quick feedback about stuff that I can think of that fits the Canadian criteria.
5. Enterprise software 2.0 ? Jevon has been talking about this for ages.
6. More variants of CRM ? Dan McGrady is building integrate. Scott Annan and Scott Lake are building MercuryGrove. I love applications that focus on improving customer interactions, increasing the resolution of the interaction, these are products that small businesses drool over because they have an immediate impact on the bottom line.
9. Photo/video sharing services ? Terry and Jeff at ParkVu are doing some really cool things.
13. Online learning ? John and Gosia have drawn a line in the sand with LearnHub (my view of their opportunity).
19. Application and/or data hosting ? Reuven Cohen is working at building some of the tools for Enomaly. While not Canadian, I?m intrigued with 10gen, Joyent, GoGrid, EngineYard and others. I wish there were some additional strong Canadian contenders in this space.
20. Shopping guides ? Omar Ismail is leading the charge for open shopping reviews at ProductWiki. Candice Factor is working on building OurFaves inside the TorStarDigital network.
21. Finance software for individuals and small businesses ? Mike McDerment and the kick ass team at FreshBooks are taking a stab at financial management tools for small business. George Favvas is building SmartHippo to enable better mortgage and financial information for consumers.
22. A web-based Excel/database hybrid ? Avi Bryant and Andrew Catton are building a great tool, DabbleDB
Kevin Leneway, who apparently is part of my brethren in DPE at Microsoft, has started going through each idea on the list one-by-one. He has decided to address each of the 30 ideas to generate ideas for a startup. It?s a great series of posts.
- Y Combinator Challenge #1: A cure for the disease of which the RIAA is a symptom
- Y Combinator Challenge #2: Simplified browsing
- Y Combinator Challenge #3: New News
- Y Combinator Challenge #4: Outsourced IT
- Y Combinator Challenge #5: Enterprise Software 2.0
- Y Combinator Challenge #6: More variants of CRM
- Y Combinator Challenge #7: Something your company needs that doesn?t exist
- Y Combinator Challenge #8: Dating
Are there other Canadian companies that are solutions to one of the 30 ideas? Share them with us!
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Tip of the week . . .
. . . do stuff with email. That gets people all hot and excited.
For example “We are going to enable Web 2.0 collaboration via email“.
That one is a freebie. Heads will nod.
I even did some market research for you: 183 billion email messages are sent per day. So if you can just capture 10% of that market, and monetize each email for 10c . . . .
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Weekend Reading – July 26, 2008
5 more reasons to go with the little guy.
VC musical chairs continues: Marc Faucher departed Summerhill Venture Partners to join JLA Ventures and drive their investment efforts in the new BlackBerry Partners Fund. / And here is Rick Segal on the the Berry Fund.
IDC released a list of Canadian web 2.0 companies to watch.
Links galore: Resources for founders in Vancouver.
How to interview a startup. / And how to interview a VC.
b5media CEO Jeremy Wright’s open letter offer to buy nearly imploded Know More Media. / And his thoughts on the infeasibility of Small-Scale Blog Consolidation.
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J2Play scores $250K grant from fbFund
J2Play, based in Waterloo, has landed a fbFund grant of $250,000. Founded by Rob Balahura in 2000, J2Play is a ?viral distribution framework for existing Web, Mobile, and PC casual games that helps them move their business to the social web.?
J2Play offers game developers a social wrapper that allows players to chat with their friends, receive awards, rank on leader boards, place advertisements, and generate revenue by promoting other games. The wrapper reaches across social networks, so for example: a Facebook user playing a game of Texas Hold?em Poker could play with one friend who is using their mobile phone and chat with another friend playing within Myspace.
Extreme Venture Partners, run by Amar Varma and Sunny Madra, had already invested a seed round in J2Play and no doubt played a large role in helping J2Play land the fbFund grant. Pretty good value-add for J2Play and a great way in leverage, validate, and de-risk the investment for XVP. This didn?t happen overnight, XVP has been working with J2Play since at least StartupCamp Toronto 1 back in December of 2007.
This fbFund grant doubles the company?s runway and is a big win. Facebook is about as good a strategic partner as one can get for a company like J2Play. Having Facebook onboard also might make it less likely that J2Play will be run over by Facebook launching a Games platform of their own? but you never know.
While we have been pretty critical of the hoards of folks building Facebook Apps and pitching those apps as scalable businesses, it was hard not to be impressed by the enthusiasm. Each Facebook Camp in Toronto has attracted over 400 attendees and Facebook often had an official representative at each event. There is a bigger picture here, companies out in Silicon Valley are paying attention to what we have going on up here in Canada.
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Kontagent – Deeper Social Network Analytics
Kontagent, which straddles Toronto and San Francisco and Toronto, and is co-founded by Toronto native Albert Lai (no relation to Rick Segal), launched today at the Facebook Developers Conference. This is one of a few Canadian announcements coming out of the conference.The application is an analytics suite focused on social networking platforms, not unlike Refresh Analytics who we profiled several months ago.
Kontagent claims to offer a deeper level of analytical reporting than other available tools and, based on the previews available on their website, they have taken a page from some of the larger analytics suites.
The platform has been under development for almost a year and requires deeper integration in to the application it is monitoring than other suites might. It is also currently free, but is in Alpha testing.
It’s good to see Albert take the shroud off of what he has been working on, he has been pretty quiet since he left Kaboose, inc., after selling his last startup, BubbleShare.
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Canada's Undervalued Real Estate
Howard Lindzon, the founder of WallStrip and a partner at Knightsbridge Capital Partners, made a post today that I think is worth talking about.
Howard spends most of his time in Pheonix, is an adviser to startups at TechStars and has done a lot of his own investing in US based startups. He thinks that things are just starting to heat up in Canada and that while there may be all sorts of problems in the US, things are stable here.
As you all know, I am very long Canada and have spent the summer getting a better feel for the landscape. I think that Toronto is the most undervalued (real estate) of the big, global cities and that combined with Fred?s thoughts above and having RIMM so close to town and the Canadian Dollar so close to par, that the Canadian web scene will thrive for the foreseeable future.
Is Canada’s web startup scene on the brink of something great? Some days it feels like startups are getting started, investors are waking up and the whole world is at our door. Other days it feels like we have the most thankless job imaginable.
I don’t know the answer, but what I do know is that the tide is turning and that it is starting to make more sense than ever to start something great here. We may not be tripping over VCs when we go for a walk, but we are tripping over talented, eager and creative folks who want to build things, find markets and make money, and that is worth more than anything.
I don’t think it is just the real-estate that is undervalued here, I think it is you.
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How Startups will save Venture Capital in Canada
Last night I pitched the audience for the second time on How Startups Will Save Venture Capital in Canada. I first gave this talk in Moncton at Third Tuesday NB and the response was great.
The title is “Why Startups Will Save Canadian Venture Capital”, and it doesn’t let anyone off the hook. It isn’t a criticism, but instead it is an analysis and a call to action for both Angels, VCs and Entrepreneurs. Things are pretty busted up right now and it is time to start talking about what we need to do to make a difference.
My thesis is simple: Startups just aren’t getting started in Canada nearly as often as they should. This isn’t about education levels, creativity or even for a lack of cash floating around this country. This is about ambition.
This is about hustle.
Most entrepreneurs have heard that things aren’t great for VCs right now. LPs are shaky, some funds are crashing, others are just throwing their hands up, and for a lot of startups it seems like no matter how many people you pitch, you aren’t getting anywhere. I tried to put some hard number behind that, and they paint a scary picture.
This goes two ways, and nobody wants to sit around while we all whine and moan that nobody can get funded. It’s time to build companies that are worth something.
We need to focus on building our local startup communities more than ever. Local communities are important because they are far easier for local Angels and Entrepreneurs to connect to, and they also act as a great filter to help find people who need national and international exposure.
Smart funders are going to see these communities as huge opportunities. There ROI for VCs getting connected to the startup community is not only obvious, but well documented. In the US we see VCs hustling in a way that you just don’t see much of here in Canada. Every time I hear a VC rant on about how Canadian entrepreneurs aren’t aggressive enough, it drives me nuts, because they are no different.
It is great to see Third Tuesday’s taking off on the east coast, and events like DemoCampEdmonton really starting to get going (there are 90 signups for their next one!), but we also need to focus on making sure that there are Startup-focused events where people need to answer to questions about their market, operations and sales.
If we can get early stage companies off the ground, then the outlook for VC in Canada starts to look a lot different. Canadian funds will have to compete against American money, but they will start to get to see great ideas and entrepreneurs at the early stage. There are a few missing pieces to this plan, but the point is that it is time for us all to stop fretting and just get on with it.
If we can build amazing startups, the money will find its way.
This is my manifesto for saving Venture Capital. It isn’t sexy, but it just might work.
*because someone inevitably does not “get it” — the comic strip at the top is a JOKE meant to characture what some would say is the VC impression of entrepreneurs, and the entrepreneurs impression of VCs.
