Saturday, February 5, 2011

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Improving Sales: The Excuse Department Is Closed

Posted: 05 Feb 2011 09:00 AM PST

Editor's Note: This is a guest post by Mark Suster, a two-time entrepreneur who has gone to the Dark Side of venture capital at GRP Partners. Suster writes a blog at Bothsidesofthetable and can be found on Twitter at @msuster.

Most technology startups seem to be funded by product people or business people. Specifically what is often not in the DNA of founders are sales skills. Nor do they exist in the investors of early-stage companies. The result is a lack of knowledge of the process and of sales people themselves.

My first startup was no different.  I had never had any sales training so everything we did for the first couple of years was instinctual.  While we did fine learning on the fly, it turned out that a lot of what we did was wrong.  I’ve started writing up some of those sales & marketing lessons and I plan to continue to build that section out over time.

As we grew into several millions of dollars of sales per year it was no longer acceptable to “wing it.”

So I did want any rational person who wants to improve does—I hired a coach.  We focused together on improving our sales methodology, our training and our comp plans. These days there are even startups to make this easier for all of us.  Back then it was a larger than life ex-country manager from PTC named Kai Krickel.  He taught me much‚most of it unconventional.  Most of it worked and his philosophies have proved enduring to me.

He called his business TEDIC.  The Excuse Departement is Closed. That mindset always stayed with me and even rung true at the time. Excuses. Whenever I heard why we didn’t feel a sales process at an important customer was going well (or if we lost) I would get involved myself. Invariably the reasons I was hearing why we weren’t well positioned versus my own perception were different.

I boil it down to this: sales people are sales people. They are the lifeblood of many companies yet they are different than the traditional technology startup DNA so the ways that you hire, motivate, compensate and assess performance of these individuals will be different. Obviously to understand a “class” of people you have to make broad generalizations. Here are mine.

Sales people:

  • Are motivated by cash. None of this namby pamby options stuff or “do it for the team – we’re all in this together” crap. Cash, cash, cash.
  • Are more mercenaries than missionaries. That doesn’t make them bad – it just means that they know that they are “hired guns” and they act accordingly
  • Many great ones don’t thrive in the early phase of a company where the sales is more consultative or evangelical. They like a solid product, well defined pricing, good references to sell against, a clear quota and well defined competitors. This is why I tell startups that most seasoned sales execs aren’t right for startups
  • They are as good at selling you as they are at selling your product to customers. That means if you don’t understand the way they work you’re susceptible to being blind sided.

Before reading my tongue-in-cheek post, please know that I love sales people.  I’ve talked many times on my blog about how they’re the lifeblood of most businesses – even those that pretend like they’re above it all. Treat them well and they’ll love working you. Treat them like the rest of the company and you’ll struggle to hold on to them.

Here’s what I learned. It’s my guide to understanding when you’re being gamed.

1. Sales people often blame the product
Startups are the art of the possible.  By definition an MVP (minimum viable product) means there’s room for improvement. Your competitors will always highlight a feature here or a feature there that is better.  Features don’t win or lose sales—especially in nascent markets. People are buying you.  They’re buying trust that you’re going to do what you’re saying you’re going to do.

Customer also buy social proof because others are acting as strong references.  (There is a nascent industry to try and help you with this, too. The best thinker I met on the topic is Mark Organ who founded Influitive to solve this. They’re in beta).  They give orders to people they like, which is why despite your best well reasoned non-sales ethos – you need to understand that sales people do need money to schmooze.

But what customers don’t do is buy features.  Don’t get me wrong—a great-looking product can really help support a sale.

Customers use features as a rationalization for why they made the decision that they concluded for a complex set of other reasons that they probably don’t even understand. How can I be so sure? Ask yourself how they came to decide what features should they be making the decision upon. Who set in their mind what the “right” feature set was? If it wasn’t you, I guarantee you they were influenced by your competitor—either through their sales efforts or through marketing.

So know up front that many times sales people will blame the product when they lose or when they’re losing. It’s never them, their lack of effort or relationships.

And as you build out your team and grow you realize that it’s always the other guys fault. It’s why leaders need to be respected, not loved or you’ll constantly be gamed. In a startup you soon learn that not only does the sales guys blame the product, but the product guys blame the marketing guys for giving them too many requirements.  The marketing guys blame the sales guys who can’t close their leads.  The sales guys in turn say that they didn’t get the Glengarry leads from marketing.

And they all secretly blame you. “It doesn’t look that tough to be a CEO. I’m doing all the hard work anyways.”

Stop the madness. You need to teach your sales team Objection Handling and make it clear that you don’t lose on features.  They can give you product input, customer requests and wish lists —sure. But the excuse department is closed.

2. Sales people will often blame your pricing
They lost the deal because your competitors dropped their price. Customers seldom buy on price. They buy on perceived value. Sure, you need to be competitive on price. But a sales person needs to be able to demonstrate the business case of why using your product will deliver more total ROI than your competitors. Otherwise you need not keep building out great features—just always drop your price! Of course that’s not true.

If your team (and you) see a competitor massively undercut you on price, you sure better be able to sell them on the notion that the temporary offset in a cheaper price won’t match the much greater benefit of working with you.

Sure, they can sell at 50% of our price. Their customer support is much smaller and therefore won’t be able to respond to your needs as quickly. We have 12 developers and they have 3. That matters because over the next 12 months our product will continue to pull further away from them. That’s why we raised $5 million from top-tier VCs.

Please call our references. We worked with customer X who saved 38% of their costs in the first year and increased sales by 14%. The pay-back period on our product was 16 months. We have lots of cases of demonstrable business success.

If we just dropped prices to match our less funded competitors we wouldn’t be able to keep innovating and adding value for our clients. If short-term price is your primary drive then our competitor might actually might be a better fit for you. We’re definitely a premium product, which is why we don’t just drop prices to match their moves to “buy” business.

Or whatever. You need to justify value. And this has to be led by your sales teams and driven home through training.

Also, don’t give your sales teams too much authority on price negotiations. Given them small authority to discount, give the sales leader a slightly larger level and anything above that comes to your desk for negotiation. Too big of a discount authority will lead to price drops because it’s easier than selling value and doing the hard business-case work. Losing on price is for losers. The excuse department is closed.

3. Sales people will often sell future development work
If your sales teams think that they can throw in some extra features that you’ll build to win the big contract they will.  I’ve seen it a thousand times. They feel like they need to show a customer that they’re flexible, listening to their needs and building features the customer perceives as important.

They’ll always lobby you to approve it.  “They can’t win the deal without it!” They’ll throw in extra storage, extra modules, extra freebies. Hold the line on any additional dev work. Find a way where the bonus program is reflected in any work that has a higher COGS due to dev work and they’ll sell around it—I promise. Don’t let them sell futures.  The excuse department is closed.

4. Sales people will often exaggerate the strength of competitors
Sales people will always tell you how far ahead the competition is. It’s the easiest way to justify losing deals, put pressure on your to build the features they want and they always believe a competitor’s PR more than the reality they see inside your business.  Always make your own assessment of your competitors. Talk personally to customers. Encourage the sales teams to give you feedback but make it clear that it’s no excuse for losing. The excuse department is closed.

5. Sales people will always ask for more sales support
Sales people are bag carriers. That’s the most important thing in your business to get revenues up. They somehow always want junior bag carriers. The more, the better.

They want lots of post-sales support. They want junior staff to work on proposals for them. “It’s not efficient for me to do my own proposals.” They want technical sales to help with customer objections.  You’re a startup. That stuff is for Oracle or IBM. They need to be scrappy, roll up their sleeves, learn multiple functions.  When you hit scale you need to add staff.  And division of labor really will drive up productivity. For now? The excuse department is closed.

6. Sales people will always tell you their quotas are too high
And my favorite. The quota. It’s always too high. It’s always unachievable. They were always above quota at every other company they’ve ever worked for. It’s all your fault. And when you get their forecasts they’re always sandbagged. And they know that you play games back. Management always sets sales budgets that roll up to a number beyond the actual board budget.

Sales people are smart—they know this. That’s where the sandbagging comes. They know you’re going to play games and ask for more so they need to leave room for you to do so. It’s the game everybody plays, everybody says they wish nobody played and yet it’s human nature. Just accept it and play the game.

Seriously, you do need to be careful about not setting unattainable quotas. But as a general rule—the excuse department is closed.

OK, so if you all took that in good enough humor for the broad generalizations that I made, I would say two things to management:

1. Treat your sales people well. Train them, arm them with a great product and sales collateral. Get out there with them—no hiding in the ivory tower. Customers want to see you. It’s the hardest job in the company. They sink or swim on their results. And as a result they’re the best paid people in the company. If they start sucking—they’re out. They know this.

2. Don’t do silly things like cap bonus payments. Make their pay-for-performance unlimited, but well structured. They are supposed to be the best paid people in the company. That’s why they endure the jobs that they have and the constant pressure to deliver results. Don’t hire sales people if you expect to be over-the-top cheap on T&E.  They need some money for schmoozing. You can book them at budget hotels—but don’t go too far. Treat them with utmost respect or their next interview is right around the corner.

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Mark Suster
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Social Commerce And The New Rules For Local Businesses

Posted: 05 Feb 2011 06:08 AM PST

Editor’s note: Guest writer Craig Donato is the CEO of Oodle, a social maretplace that powers the Facebook Marketplace.

Ecommerce today is imbued with the same DNA that runs through Google. It's automated. It's algorithmic. It's certainly not human. And the marketing campaigns that are built with this DNA are similarly data-driven. They employ number-crunchers to capture their leads and build their databases, all the while looking for incremental ROI and arbitrage opportunities.

But a new marketing game has come to town—social commerce. And at its core is an entirely different bit of DNA: the DNA of Facebook. This new variety of social commerce is about conversations. It's about relationships. It's about re-humanizing online commerce. And for marketers to succeed with social commerce, they are going to have to rethink their game plan. Facebook has given us a brand new color palette. Now it's up to us to figure out how to use it. I like to call this learning process "de-ecommercification."

Succeeding with social commerce requires marketers to act human. Rather than searching for information, consumers are discovering things through trusted referrals and recommendations. Instead of being a marketing medium driven by click-through rates and lead conversion, Facebook is a medium of relationships and conversations. This is going to require some adjustments by marketers, and in this new game they are going to need to:

  • Practice the art of conversation. Social commerce is not about capturing leads and building databases. It's about talking to people with an authentic voice, the same voice you would use if you were talking to them in person.  (Remember, you’re talking to your customers in the same place they use to chat with their friends.)
  • Build and deepen customer relationships. Customers are the trusted network, the community that surrounds a business. By taking care of your customers, you not only deepen those relationships, but you also fuel referrals.

It's true that many other people in our industry besides me talk about "social commerce." What they are really talking about, though, is "social shopping." For example, if you were thinking of getting a new video camera, you would probably want to get recommendations from your friends about which one to buy. This is pretty cool, but it's also very incremental. It's social icing on the ecommerce cupcake.

Social commerce will have its biggest impact with a different set of businesses—businesses that are naturally "relationship businesses," and these are easy to spot. They're typically local businesses, those whose primary form of marketing has always been word-of-mouth referrals: local service providers, real estate agents, landlords and employers.

If you're looking for a new house cleaner, which would matter most to you:

a) A half-dozen reviews from people you don't know.

b) A coupon for 10% off the cleaner’s first visit.

c) Two friends that use the same cleaner—and are fans?

Say you're looking for a new apartment and trying to figure out where to live, do you want lots of data on maps, or advice and recommendations from your friends and co-workers?

While social commerce is going to be disruptive to local businesses, that doesn't mean it's going to all be about deals (at least not yet). The DNA of Groupon (despite winning the Crunchie for Best Social Commerce App) is ecommerce while the deals it offers, which are cost-effectively generating leads, are ecommerce icing. In the new realm of social commerce, deals will evolve to serve a different master. They will be focused on deepening the relationships you have with your current customers, and through this end, fueling referrals.

This may sound complicated and confusing, but local businesses should get the hang of this quickly. It's all very back-to-the-future stuff for them. Great local businesses have always been people-based businesses that understand the power of relationships and the importance of participating in a local community. There's a reason the car dealership sponsors the local little league team.  What these businesses haven't yet been able to figure out is how take what they're already doing in their local communities and transfer it to the new world of Facebook and the Web. But they're learning . . . and when they do, it will be transformational not only for them, but also for us—their customers.

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Craig Donato
Oodle
Facebook
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Ze Frank’s Star.me Is Like Being In Kindergarten All Over Again

Posted: 04 Feb 2011 10:43 PM PST


Every once in awhile you come across people who are entirely original, and Ze Frank is one of those people. While many people as eccentric as Frank end up with not so amazing lots in life, Frank, who originally studied Neuroscience at Brown, most recently received $500K from Andreesen Horowitz, Betaworks, Lerer Ventures, Founder Collective and Ron Conway to focus on creating novel social games. Now the world gets to see the fruits of his labor.

Kicking off today in invite-only beta is Frank’s Star.me. Star.me is a social network meets social game based around positive reinforcement, or the action of giving people Stars. The appeal of this is very basic but poignant. At our core we all want to be liked and given validation. Frank calls the game, “A twist on the manifestation of identity as reflected through others.”

Focusing solely on the exchange of virtual goods or Stars that people can display on their profiles, Star.me is unlike anything else you’ve seen. And off-puttingly positive. When asked who his closest competitor was, Frank said  social gaming beast Zynga. While granted some of the game mechanics are similar, Star.me and FarmVille couldn’t be further apart. First of all, Star.me follows Frank’s basic tenet of how to get popular on the Internet, “Dance like an idiot and don’t sell anything.”

Zynga, not so much.

On Star.me you, as a consenting adult, can chose to give out themed Stars with messages like “UR CRAZY,” “UR CUTE,” “BFF,” “Frenemy,” “Bromance,” and (!) “Mom Jeans.” Both the actions of giving and receiving Stars cause new and more diverse stars to be unlocked and obviously, more people sending stars in your direction. Your objective is to give and to get others to give to you through a series of transactions, Games People Play style. Sort of like life (Hint hint, things tend towards reciprocity).

A personal Star.me profile is like an About.me splash page with visible signs of how much people like you. It features a collection of things that people have taken the time to give you, that they think represent you. In a direct attempt at connecting virtual goods and human relationships, your profile reveals “Stars sent” and “Stars received” as well as inventory you still have to give. When you click on “Give A Star” in the top right of your dashboard you are presented with a palette of unique options which you can choose to distribute to your friends via auto-populating user names from Star.me, Facebook, Twitter and email.

You can also chose to share your distribution of Stars on Facebook and Twitter and through a permalink. “I love the little squeals of excited in the Buzzfeed office when someone gets a star,” said Buzzfeed co-founder and investor Jonah Peretti about the service.

As of right now, you have to be invited to join Star.me  but once in you can invite as many people as you want. If anyone can’t wait and wants an invite, please email me and I’ll send you one, my email is notoriously easy to figure out, especially for tech smarties like yourselves.

“I’m fascinated by simple joy,” says Frank who has chosen this as the sole project and platform of Ze Frank Games. When asked what the ultimate utility of this endeavor was, Frank originally heard “futility” and when I corrected him told me that “What’s the ultimate futility of this endeavor?” would have been a better question.

When I quipped that utility and futility were ultimately the same thing he humored me, “Well, what’s the ultimate utility in the social relationships that you have? Fun, depending on what economics you subscribe to can be a utility or a disutility.” He went on, “It’s a novel idea where people say great things about each other. It’s a lubricant … What Halmark cards are, they make things easy to say…  We would be having the same conversation if Star.me was a brand of vodka.”

True.

In terms of future plans, Frank is working on UI issues (“What does 10,000 stars look like?”), tweaking games mechanics, figuring out creative ways to monetize (“Monetizing fun has been the biggest story of the past couple of years”/”Right now we’re focusing on making the experience as awesome as possible”) and figuring out how to give out more Stars, “For some reason we stopped getting gold stars at some age. It’s time to bring them back.”

You can watch Frank’s TED talk below. Because it’s awesome.

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Star.me
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Search Underdog Blekko Sees Over 30M Searches In January, More Than 110K Slashtags Created Since Launch

Posted: 04 Feb 2011 07:00 PM PST

Nowhere has the need for a more diverse search market been more apparent than this week’s revelation that Bing was cribbing Google’s notes.

While Microsoft VP Harry Shum and Google’s Matt Cutts squabbled on a panel together at the Farsight 2011 conference, Blekko CEO Rich Skrenta looked on, more a human symbol of the call for greater market diversity than anything else.

Earlier in the week Blekko made the decision that it would block content farms like Demand Media’s eHow and AnswerBag and is now announcing another milestone, over 30 million search queries in January and over 110K slashtags (curated topics) created since its launch in November.

This breaks down to about 10-15 search queries a second and over 1 million searches a day, which is at levels over its original traffic spike at launch. In contrast, Google was serving over 88 billion searches a month at last count (the 2010 Comscore numbers have yet to come out as far as I can see).

Even though the concept of slashtags is hard to get used to,  here’s why I think Blekko has a fighting chance:

The company, helmed by Skrenta and Greg Lindahl is funded to the nines with $24.4 million from investors like Marc Andreessen, Ron Conway, Jeff Clavier and wildcard Ashton Kutcher. Skrenta told me himself that Blekko isn’t going away any time soon, especially if they keep adding streamlined utilities like the ability to search by your own customized slashtags, date, by site type, both date and site type and most recently the ability to search by Facebook “Likes.” Unveiling a mobile version three months in is also a savvy move.

Blekko keeps getting referenced in articles like this one simply because it keeps reinforcing its place at the search table terms of innovation and press stunts, like its Spam Clock, which is a running meter of all the spam created in the US (1 million pages every hour) or the bold move to ban specific sites when Google only broadly referenced spam filtering algorithms in the wake of critical articles like “Why We Desperately Need A Better Google.”

Once you get past the intimidation of creating a funny sounding slashtag, the site becomes extremely useful on a micro-personal level. Individuals will use it in a different ways, depending on what frustrates you about search. But I have a feeling Blekko doesn’t care if you use it now, it’s got a bunch more tricks in the works to keep you coming back.

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Blekko
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The Verizon Vs. AT&T Ads Prove One Thing: The iPhone Is Helen Of Troy

Posted: 04 Feb 2011 06:33 PM PST

The most recent Verizon and AT&T commercials are awesome because everyone loves a good slap fight — especially one that is played out in public (for more evidence, see Google vs. Bing earlier this week). But they’re actually even more interesting under the surface. Because it’s a fight that has only one real winner. But it’s not who you might think. It’s neither Verizon nor AT&T.

It’s Apple.

Think about it. Both AT&T and Verizon are spending millions of dollars to bash each other in these high-profile commercials. But the overall impact of these commercials is likely to be that they completely cancel each other out. If AT&T feels Verizon is winning, they’ll just order more ads, and vice versa. And so again, the only winner in these ads is the one common element: the iPhone.

At first, I found the fact that Apple would sign off on Verizon and AT&T using the iPhone to attack one another a bit odd. After all, since Apple now partners with both, they have to keep both relatively happy. But this strategy is actually genius. Apple, of course, isn’t going to say a bad word about either (instead, they’ll tout both), but by letting them say bad words about each other, they’ll ensure that more and more and more commercials get made. That’s the way the negative ad campaign game is played. More equals better.

And “more” is music to Apple’s ears. Because they don’t have a losing card here. In fact, they only have winning cards. If you choose a Verizon iPhone, Apple wins. If you choose an AT&T iPhone, Apple wins.

What we have are two beaus fawning over the same beautiful woman. Each is arguing — again, in public — why they’re the better longterm partner. And considering that the two beaus, Verizon and AT&T, happen to be two biggest carriers in the U.S. that the majority of users are connected to, this battle is making the the beautiful woman, the iPhone, look like Helen of Troy.

A year ago at this time, Verizon was spending their marketing muscle pumping up their Droid devices while attacking the iPhone. We’re not seeing those commercials anymore. And the fact that Verizon was so quick to switch up allegiances also has a deeper meaning. When the other ads come out attacking Apple products (like the one Motorola is planning for the Xoom), Verizon’s change of heart will undercut that ads effectiveness. Because it shows that these companies are only running negative campaigns against Apple because they’re jealous.

If those companies get let into Apple’s world, all of a sudden, the animosity turns to pure fawning. To love.

Of course, the likelihood that Motorola would ever be let into Apple’s universe is slim. But still, if they were allowed to say, create a device with iOS, is there any question that their ads would do a quick 180? Nope. And that’s exactly why the ads, while possibly effective, don’t really carry a lot of weight. Motorola wants to be in bed with Apple — just like everyone else does.

Who wouldn’t, with Helen of Troy?

[image: Warner Bros.]

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Verizon
AT&T
iPhone 4
Apple
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Android Honeycomb’s Mesmerizing Bootup Screen

Posted: 04 Feb 2011 05:36 PM PST


Earlier this week we posted an extensive preview of Android Honeycomb, the tablet version of Google’s mobile OS that will start shipping on devices later this month. But we saved one more tasty bit of Honeycomb for the weekend: the OS’s bootup screen.

It looks like something out of Tron, and it’s a nice departure from the boot animation seen on the Nexus One and Nexus S, which features swirling strands of color coming together to form the Nexus ‘X’ symbol (you can watch it below).

Apologies for the glare — this wasn’t shot under ideal circumstances.

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Android
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Groupon’s “Rejected” Super Bowl Ad Is A (Subtle) Jab At LivingSocial

Posted: 04 Feb 2011 03:57 PM PST

The battle of the social media Super Bowl ads continues, with daily deals Groupon just posting on its own blog about how it rejected an ad concept where someone goes through a Groupon addiction, an idea conspicuously similar to what people are reporting competitor LivingSocial has up its sleeve for its 30 second ad before this Sunday’s Steelers vs. Packers game.

Internet Retailer describes LivingSocial’s ad, “The pre-game spot tells the story of how one man’s life changes as a result of his "deal addiction" with LivingSocial. The campaign was created by Martin Agency.” The details of what Groupon and ad partner Crispin Porter Bogusky have up their sleeve for Sunday are still unknown but we can be pretty sure as to what they’re not going to do (see what got left on the cutting room floor, above). Heh.

From the Groupon blog:

“Groupon's Super Bowl ad is almost here – our very first offline campaign! We just wanted to take a moment to say thanks for all of the interest and buzz. We're dying to show it to you and I don't think you'll be disappointed.

While we can't share our TV spots yet, we thought you'd enjoy seeing an idea Deutsche Bank shared with us that didn't make the cut. Meet the Groupon addict.”

Last time the two deals sites faced such a head to head comparison was when LivingSocial’s Amazon $10 gift card flash deal brought in over $13 million dollars, beating Groupon’s Gap record of $11 million. Sitting pretty with a $175 million dollar investment from Amazon, underdog Living Social used some of its cash to go in on a pre-game ad a few days after Groupon secured its spot.

LivingSocial has over 16 million subscribers while Groupon had over 44 million at last count. According to Experian’s rough data based on site visits in January, LivingSocial now has a 30% marketshare in the daily deals space, encroaching on Groupon’s 60% dominance aided by the success of its Amazon deal.

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Groupon
LivingSocial
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They’re Commercial Fighting! AT&T Shows How Talk And Surf Is Useful

Posted: 04 Feb 2011 03:53 PM PST

Yesterday, Verizon launched a commercial campaign to highlight that they now have the iPhone 4 with one important feature: the ability to make calls. While they never mention their competitor (or humorously, even the iPhone itself), it’s clear who this was aimed squarely at: AT&T. But AT&T is not about to take the punches sitting down. Today, they have their own ad.

“Answers” shows a man in his office working when he receives a call on his iPhone. It’s his wife, wishing him a happy anniversary. Naturally, the man forgot. He quickly heads to Google on his iPhone and starts searching for a restaurant to make a reservation at. This is something that would not be possible with the Verizon version of the device.

The voiceover hammers their point home a little more directly than Verizon’s commercial did yesterday: “Only AT&T’s network lets your iPhone talk and surf at the same time.”

Of course, I’m going to assume the man has access to a computer in his office building. He could have just as easily hoped on that. But I digress — this is war!

I wonder what the over/under is on how many of these commercials we’re going to see? I’d bet the over.

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AT&T
Verizon
iPhone 4
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Facebook Turns Seven: From Colleges To Cairo, You’ve Come A Long Way Baby

Posted: 04 Feb 2011 02:47 PM PST

From founder Mark Zuckerberg’s dorm room at Harvard to movie theaters across the US to the cover of TIME magazine to the fingertips of protestors in Cairo, Facebook has probably had more influence over our day to day lives than any other startup this decade.

To celebrate its seven years of incredible growth, the company has put up a custom candle graphic up on its Facebook wall, with the message, “To the 1.5 million of you who share our birthday today – Happy Birthday!” The image has received over 8,000 comments and 48,558 ”Likes” thus far.

According to reports the company is nearing a 600 million user milestone, and that “1.5 million of you who share …” statement is conspicuously an order of magnitude less than if applied to the total world population (6.9 billion), so it must somehow relate to the Facebook population itself. If you assume that birthdays are evenly distributed, the 1.5 million number times the 365 days in a year would mean that Facebook has around 548 million users. But birthdays are not evenly distributed, and February tends to be a below average month in terms of birth distribution.

Of course 548 million is an underestimate, as it’s also possible that the 1.5 million here is just the number of users who have chosen to specify the specific February 4th birthday to Facebook, and the unspecifieds don’t get counted. I’ve emailed almost everyone at Facebook trying to get the actual methodology and received this response …

"As we turn seven, we'd like to thank everyone who uses Facebook in unique ways around the world, ways in which we never could've imagined, and for continuing to inspire us to provide a service that makes it easy for people to connect with the things and people they care about. We also wish the more than 1.5 million people who share our birthday, February 4, a very happy birthday."

Guess we’ll have to wait until someone fesses up. In the meantime: Most recently the company was in the spotlight for plans to make Facebook Credits the primary form of in-game currency by July and also for being a tool facilitating communication between anti-Mubarak protestors in Egypt. Facebook is valued at over $50 billion dollars, or priceless.

“Thank you Facebook” image: Richard Engel/Mediaite

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Facebook
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Tango Takes Face-To-Face Video Calling Beyond The iPhone With 8 Million Downloads

Posted: 04 Feb 2011 02:26 PM PST

One of the best built-in features of the iPhone 4 is FaceTime, the video calling feature that lets you see who you are talking to by using the cameras on both phones. But it only works over WiFi and if both callers own an iPhone 4. Perhaps those limitations are why an app called Tango is the seventh most popular social networking app right now (iTunes link).

Tango lets you make video calls not just on iPhones but also on Android phones, and it works over 3G data networks as well. It works on both the iPhone 4 and the 3GS, and even iPod Touches. It’s been growing like crazy on both iOS and Android devices, adding one million downloads every two weeks. In the past three months, it’s grown from about 1 million downloads to 8 million (see chart. Of those, 7.2 million became registered users, and 42 percent (or about 3 million) have made a video call in the last 30 days.

Tango provided us with some other stats on its usage and growth as well. About 2.6 million people downloaded the app as a result of a direct invitation, with 45 percent of invites resulting in a download. The average length of a video call is 4 minutes. Downloads are split evenly between iOS and Android, and 60 percent of calls are over 3G or 4G data networks instead of WiFi. (Are you listening Apple/AT&T/Verizon?) Although the U.S. is the single largest country for Tango, the majority of members (55 percent) live outside the U.S. And half of the top 10 countries (South Korea, Hong Kong, Japan, Taiwan, and Singapore ) are in Asia.

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Tango
iPhone 4
HTC EVO 4G
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Help Make This Wild Braille Watch A Reality

Posted: 04 Feb 2011 02:02 PM PST

David Chavez has a dream. He wants to build this wild-looking Braille watch that shows the time by moving little rotating dots along the face to spell out the numbers in Braille. Even if you’re not visually impaired, you have to appreciate the ingenuity and usability this watch, called the Haptica, has to offer.

The project is up on Kickstarter now, so pop over and pre-order if you’re so inclined. Considering most watches for the blind haven’t changed since the early 1900s – take this Seiko “Braille” watch for example – this is an interesting step forward.

Read more…



Buy Your Valentine’s Gift Through Causes, And They’ll Donate $10 To Charity

Posted: 04 Feb 2011 01:08 PM PST

It’s only ten days til Valentine’s Day (ugh — err, yay!), which means many of you are vaguely aware that you should do something special for your significant other. And this year there’s a way to give your sweetheart a nice gift while also giving back to charity.

Causes has just launched a special promotion available at Causes.com/valentines. The concept is simple: buy a gift through the site, and you get to donate $10 to a nonprofit, like Campaign for Cancer Prevention or Invisible Children. You can also choose to donate the money to any of the Causes you’re part of on the site. Pretty cool.

Causes is essentially donating the affiliate fees they’d typically receive from their retail partners. The promotion is using different retailers for twenty countries around the world: in the U.S. it’s Proflowers, Spain has Aquraelle and Serenata Flowers, and so on.

Causes founder Joe Green says that the company’s main goal this year is to make as easy as possible for people to give — and this is about as easy as it comes. But the service did run into one snag: Causes has viral sharing down to an art, but they’ll have a hard time getting this promotion to go viral because writing “Jason bought some Roses on ProFlowers” to my News Feed would spoil the surprise.

Fortunately the service will still tell my friends that I donated $10 to a charity, so they’ll think I’m a good guy. For bonus points, donate your $10 to your sweetheart’s favorite charity (and don’t be shy about telling them).

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Discovering The Distance-to-Discount Ratio

Posted: 04 Feb 2011 01:01 PM PST

When it comes to deals, the bigger the discount, the further people will travel. While this may sound obvious, mobile advertising company JiWire has some numbers to back it up. JiWire is releasing a new study today that evaluates consumers; behavior when it comes to location-based deals and discounts.

In a survey of more than 3,000 respondents, JiWire’s results show that the greater the discount, the further people will travel to redeem a coupon or promotion. For example, for a $100 item, 55 percent of consumers are willing to travel 15 minutes for a 10 percent discount. But 40 percent of respondents will travel an hour for a 50 percent discount, and 28 percent will travel two hours for a 75 percent discount. Essentially, higher discounts motivate consumers to travel farther.  But there are limits to how far people will go.  Even if you give away a product worth $100 for free, only 31 percent of people would travel more than two hours to get it.

While many location-based promotions generally target customers in an immediate vicinity or neighborhood, JiWire’s data indicates that the opportunity to reach new customers goes far beyond the check-in and can draw new customers, even from more than an hour away, into stores,

This isn’t surprising data but it does suggest that location-based deals can be targeted to users beyond just an immediate vicinity.

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JiWire
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Multinational Startups: The Future Or A Doomed Idea? (TCTV)

Posted: 04 Feb 2011 12:36 PM PST

In our second segment with Ankur Jain of the Kairos Society, we talk about the idea of multinational startups.

A lot of startups like to say they are “global from day one,” but typically that’s just marketing. Most of the startups I know who have tried to be truly global from day one– focusing explicitly on several big markets at once with co-founders spread around the globe– have said later they didn’t recommend it. Many entrepreneurs would argue there is just something about facetime, coding in the same room, and building a project physically together that is core to how a startup works and a culture is built. After all, it’s hard to be nimble when you’re navigating cultural, language and time-zone chasms.

Nevertheless, Jain thinks it’s the future. He explains why in the video below.

Rainbird: The Way Twitter Counts Tweets In Realtime (Which Will Be Open Sourced)

Posted: 04 Feb 2011 11:40 AM PST

Yesterday, Twitter analytics lead, Kevin Weil, gave a talk at O’Reilly’s Strata 2011, a conference dedicated to big data. The main topic of the talk was Rainbird, Twitter’s realtime counting system that’s built on top of Cassandra. Notably, it powers a number of things Twitter uses internally, such as Promoted Products analytics, operational monitoring, and even Tweet Button counting.  Today, Twitter has posted the entire presentation to SlideShare, which means we can now embed it above.

It’s fairly technical, but also pretty easy to follow along with. If you’re at all interested in how Twitter acquires, stores, and uses the massive amount of data they deal with, you should check it out. It also gives a glimpse into their Promoted Tweet analytics package (which looks quite nice).

Most importantly, you’ll probably want to know about it because Twitter plans to open source it. But first, they have to wait for the version of Cassandra they’re using to be official released, and for some of their own internal stuff to be open sourced. But Weil promises that it will happen.

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Twitter
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How The iPad Time Shifts Online Reading

Posted: 04 Feb 2011 11:18 AM PST

One of the reasons bookmarking apps like Read It Later and Instapaper are becoming so popular is because we are inundated with news and interesting links all day long, but have no time to read them. But just as DVRs helps us shift our TV viewing to better fit our own schedules, these apps helps us time shift our online reading. And according to some data put out earlier this month by Read It Later, it looks like the iPad is becoming the time-shifting reading device of choice.

Read It Later offers bookmarking apps for computers, mobile phones and iPads. It looked at 100 million articles saved by its users. The chart above shows the amount of saving activity by time of day. It is pretty consistent throughout waking hours, as you’s expect from people who are constantly bombarded with new information. It just never stops. Below is a chart showing when iPad users actually end up reading what they saved. As you can see, the time reserved for reading is shifted all the way to the right, with the sweet spot being between 7 PM and 11 PM at night. This suggests that iPad usage is competing with primetime TV for people’s attention (or that they watching TV with iPad in hand, or shifting their TV viewing to other times).

People who end up reading the articles they saved on their computers, don’t shift their reading times so far to the right. They tend to read throughout the day whenever they have time, which makes sense for people who sit in front of computers all day. They read saved stuff whenever they have a free moment. The chart below shows an overlay of articles read on computers by iPad owners with articles led by people non-iPad owners in gray in the background. iPad owners also read their saved articles on their computers, but mostly in the middle of the day. As they get more downtime, they shift to their iPads.

If you look at when users read saved articles on their iPhones, the graph is more spiky around commutes, early morning, and late evening. The iPhone is an interstitial reading device, filling in the moments in between activities.

(Hat tip to John Borthwick).

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Read It Later
iPad
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Demotix Makes Hay While The Middle Eastern Revolutions Shine, Thanks To Twitter (TCTV)

Posted: 04 Feb 2011 10:25 AM PST

Demotix is a London-based startup which has attracted a new wave of attention since the wave of civil unrest has swept the Middle East, particularly in Egypt.

The idea is not new: upload photos and videos to a platform to create an alternative news wire / agency. What is new is that as the mainstream media’s coverage of international events has been shrinking – it is no longer cost efficient to have a guy in some far-flung bureau filing the one annual story a year – so has Demotix’ coverage expanded with professional and semi-professional contributors. In each case Demotix checks out the credentials of contributors, who can then earn news agency fees from their output. It splits the revenue with photographers 50/50 each time the photo or video is sold (major photo agencies take a much larger cut and only pay photographers once). Photos sourced from Demotix have appeared on the front pages of New York Times, Wall Street Journal, Time, and The Guardian. In August last year it signed a deal with the Publish2 news exchange giving it access to US distribution.

HoneyApps Raises $1 Million For Security Management Software

Posted: 04 Feb 2011 10:15 AM PST

Chicago-based startup HoneyApps has raised $1 million in funding led by Tugboat Ventures with Hyde Park Angels participating in the round.

Co-founded by Orbitz’s former Chief Information Security Officer Ed Bellis and Jeff Heuer, HoneyApps offers businesses and government agencies a comprehensive security management software. Called Conduit, the software will consolidate all of a businesses’ security vulnerability information, reporting and management into a single place. The startup will then analyze and track a company’s vulnerability across applications, networks, servers, and databases.

The software aims to be a one-stop shop for security issues in a company, giving users the ability to manage the entire life-cycle of security bugs from detection to close. Although the SaaS app has only been available for a short time, reviews are fairly positive so the startup is worth a second look.

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HoneyApps
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TechCrunch Giveaway: A Dell Vostro V130 Laptop #TechCrunch

Posted: 04 Feb 2011 10:01 AM PST


There was a certain ad on TechCrunch last week you may have heard about. You may have even noticed it yourself and you may have gotten a little annoyed by it. The interstitial ad was advertising a Dell Vostro V130 laptop. These laptops normally cost around $429, have an award-winning design, and weigh a very light 3.5 pounds. We wanted to say we were sorry to Dell for calling out their ad, so today we are giving one of these laptops away to one lucky reader!

If you want this Dell Vostro V130 laptop, just follow these steps to enter.

1) Become a fan of our TechCrunch Facebook Page:

2) Then do one of the following:

- Retweet this post (making sure to include the #TechCrunch hashtag)
- Or leave us a comment below explaining why this laptop should be yours

The contest starts now and ends tomorrow, February 4th at 7:30pm PST.

Please only tweet the message once or you will be disqualified. We will choose at random and contact the winner this weekend with more details. Anyone in the world is eligible, as long as you can receive delivered packages. Good luck!
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