A version of this article previously appeared in Forbes. Even entrepreneurs that already sold on SaaS should stake note of new research from the SalientGroup: SaaS gets funded - Nearly 50% of SaaS-based startups are getting successfully funded—a rate of funding success no other sector can match. SaaS-based companies grow - The SaaS market is growing 3x faster than the software market (20% vs. 7%), and this rate is expected to continue through 2020. Overall, according to Gartner, the SaaS market will top $22 billion by 2015. But there are some even bigger reasons organizations at every stage should increase their savvy in SaaS. According to Dave R Taylor, CMO of Impartner, SaaS’s ability to snap in modular solutions at the highest levels is revolutionizing the final bastions of traditional IT.
A version of this article previously appeared in Forbes. In the 1998 movie The Big Lebowski, Jeff Bridges’ character, The Dude, laments the destruction of his favorite rug by repeatedly stating, “That rug really tied the room together.” In homage to The Dude’s sentiment, tech startup Akanda Virtual Networking named its open source project The Rug because it “ties together” OpenStack networks by managing orchestration, routing and other key network services. According to Peter Christy, Research Director of Networks at 451 Research, “Akanda isn't the first open source network option for OpenStack, but its layer 2 agnostic approach, combined with Akanda's interfaces to network-dependent OpenStack projects such as Ceilometer and Horizon, give it a leg up when compared with self-contained 'black box' competitive approaches.”
A version of this article previously appeared in Forbes. Sometimes being clueless makes you fearless. This was certainly the case with Hollywood star turned inventor, Hedy Lamarr. In 1937, Ms. Lamarr abandoned a successful European film career to become a Hollywood star. Although successful, she quickly became bored with the vapid nature of stardom, once saying, “Any girl can be glamorous. All she has to do is stand still and look stupid.” Unsatisfied with the intellectual limitations of Hollywood, Ms. Lamarr collaborated with an unlikely partner and together they created a fundamental invention which helped secure their lives of hundreds of thousands of servicemen and women. More significantly, their innovation subsequently became the basis one of the most significant products of the past century.
A version of this article previously appeared in Forbes. There are two schools of thought regarding how to make anything go viral. In The Tipping Point, Malcolm Gladwell emphasizes the importance of the messenger. In contrast, Jonah Berger’s Contagious: Why Things Catch On proclaims that a properly structured message makes the messenger inconsequential. Which approach is correct? As with most business strategies which migrate from the classroom to the real world, the “correct approach” involves combining the appropriate elements from multiple theories and applying them to your specific situation.
A version of this article previously appeared in Forbes. The Beatles’ Manager, Brian Epstein, was a 30-yr old, former furniture salesman when Beatlemania hit America in 1964. When he was approached by savvy Nicky Byrne to license the Beatles’ name and likeness for various novelty products and toys, he firmly stated that he would not accept a penny less than 10%. Nicky had a difficult time hiding his surprise, as the typical range for such licenses was between 30% to 50% of the product’s price. Mr. Byrne quickly signed dozens agreements with merchandisers that subsequently cost the Beatles approximately $100,000,000 in lost royalties. Mr. Epstein later re-negotiated the Beatles’ share to 45%, but by then, Beatlemania was on the wane and the financial damage had been done.
A version of this article previously appeared in Forbes. In 1987, a representative of Michael Jackson approached the modest Sycamore Valley ranch house and knocked on the door. The owner of the ranch was shocked by the visitor’s message. He told the homeowner that he represented someone who wanted to purchase the ranch at a substantial premium over its current fair market value. He also indicated that the offer was non-negotiable and the home owner had to respond either “Yes” or “No” in a matter of hours. Although this is a somewhat unusual real estate transaction, it reflects a surprisingly common scenario in the business world of mergers and acquisitions, with one important distinction.
A version of this article previously appeared in Forbes. When you can live where you want to live and make money doing what you love to do, you are, by my definition, a screaming success. Six outstanding entrepreneurs have created this sweet flavor of success in one of the most beautiful places on earth – Santa Barbara, California. Santa Barbara has become a high-tech startup mecca, rivaling cities many times its size. The latest evidence of the city’s dynamic startup ecosystem is the recent announcement by Citrix to investment significant resources in the Santa Barbara Innovator’s Program. The community is blessed with a temperate climate (average high temperatures between the mid-60's and mid-70's °F), which motivates accomplished people, who can afford to live anywhere, to make Santa Barbara their home. Many of these individuals become restless in their youthful “retirement” and begin investing and advising young companies. Combine this significant pool of sophisticated Angel capital and expertise with UC Santa Barbara’s world-class entrepreneurial program and throw in a critical mass of entrepreneurs bold enough to build businesses around their passions, it’s understandable how a modest-sized community has produced so many successful tech startups. From Lynda.com’s recent $1.5 billion dollar acquisition by LinkedIn to Bessemer’s substantial investment in ProCore, AppFolio’s recent IPO filing and Sonos’ $130 million secondary, the Santa Barbara tech scene is unquestionably on fire. However, less obvious is Santa Barbara’s rich history as a hotbed of lifestyle startups, a number of which have generated billions in revenue and garnered worldwide recognition.
A version of this article previously appeared in Forbes. Congress' latest attempt to impose an "Internet sales tax" is just another misguided tax grab that will do more harm than good to American small businesses. The Remote Transaction Parity Act (RTPA), introduced by Representative Jason Chaffetz (R-UT), purports to simplify sales tax collections while also leveling the playing field between brick and mortar businesses and online sellers. Noble goals, no doubt. Unfortunately, it accomplishes neither.
A version of this article previously appeared in Forbes. Facebook recently joined Google and Twitter by offering a click-to-call functionality in its ads, giving consumers an option to call businesses directly, versus emailing them or completing an online form - effectively making the plain old phone one of the most powerful on/offline marketing tools of the coming decade.
A version of this article previously appeared in Forbes. During my 15-years as a startup executive, I relished being proven wrong. Knowing that I was had made a mistake empowered me to make the correct decision. Being wrong is much preferred to erroneously thinking you are right and relentlessly executing a losing strategy. Effective entrepreneurs reject dogmatism and embrace doubt.