Archive for January, 2008

How we put Yieldex together

Tuesday, January 22nd, 2008

Every company has a “how we got started” story. For example, here’s the NetGravity startup story. This is the story of how I got involved in Yieldex.

First, a little background (bear with me – this is relevant). After we sold NetGravity, and I took some time off, I was thinking about a career change: get a PhD and become a computer science professor. I’ve always loved to lecture (a trait shared by many VCs, which is not necessarily a good thing), and I thought I might enjoy the pure intellectual stimulation of academia.

I began by looking for an interesting topic, because I got some advice from professor friends that most PhD students spend the first couple years just trying to pick their thesis topic. One hard problem we had worked on at NetGravity was the “overlapping inventory” problem, so I wrote a short paper on the topic to present to the HPTS Workshop, a fairly exclusive enclave of the top database academics in the world, including Jim Gray, Ed Codd, and Michael Stonebraker. Mostly I wanted to see if they could tell me if the problem had been solved before. I got generally good feedback that it looked like an interesting and unsolved problem.

For a variety of reasons, I ended up going into VC instead, and put the problem on the back burner.

Doug Cosman was one of the key employees at MatchLogic, another early internet advertising startup that was bought by Excite. Doug’s work after Excite led to the key insights that underlie the Yieldex technology, and he raised some angel funding to pursue developing those ideas. Doug was searching patents and other sources for prior art during his patent application when he came across my paper on the HPTS web site, which by then was ranked highly by Google. In a fairly random coincidence, one of Doug’s angel investors at Sequel Ventures, Chris Scoggins, is a friend of mine, and put Doug in touch with me directly.

I have to admit, I was pretty skeptical that some guy in Boulder had solved a problem that had pretty much stumped the industry for the better part of 10 years – classic Silicon Valley arrogance. I put off talking to him for some months, but fortunately he was persistent. Finally he came out to visit, and in a four-hour session with the whiteboard, convinced me he had a novel and workable solution.

Learning about his solution re-ignited my own interest in the problem and the space. Of course, it didn’t hurt that DoubleClick had just been acquired for $3b and aQuantive for $6b, and the space was hot in general. The more phone calls and meetings I had, the more clear it became to me that this was still a huge problem for the industry, and that nobody had solved it well. Also, for me personally, the process of doing diligence and getting back in touch with a number of people reminded me that I had a lot of personal credibility and expertise in this area. Very quickly I made the personal transition from wanting to invest to wanting to be involved.

Fortunately, Doug and his angels had already talked about hiring a CEO in the Bay Area, so it was fairly straightforward from that point on.

The Woodside guys have been great to work with, they have been incredibly supportive and helpful. They invested in the Series A, and I’m still very much a part of the Woodside Fund family, now as a Venture Partner and a portfolio company CEO instead of a Managing Director.

Jimmy Carter has what we need!

Monday, January 14th, 2008

I love this article in The Onion, purportedly by Jimmy Carter, not because it’s so funny (although it is pretty funny), but because of how wickedly they send up everybody else in the 2008 race by pointing out how much better Jimmy Carter is on every dimension.

Reminded me a little bit of how rarely people change their opinions – most people seem to think Jimmy Carter was a terrible President. Here’s another example, from the Wall Street Journal a while ago (blogged about here):

Starting 30 years ago, [Julian] Simon (who died in 1998) told anyone who would listen — which wasn’t many people — that the faddish declinism of that era was bunk. He called the “Global 2000” report “globaloney.” Armed with an arsenal of factual missiles, he showed that life on Earth was getting better, and that the combination of free markets and human ingenuity was the recipe for solving environmental and economic problems. Mr. [Paul] Ehrlich, in response, said Simon proved that the one thing the world isn’t running out of “is lunatics.”

Mr. Ehrlich, whose every prediction turned out wrong, won a MacArthur Foundation “genius award”; Simon, who got the story right, never won so much as a McDonald’s hamburger. But now who looks like the lunatic? This latest survey of the planet is certainly sweet vindication of Simon and others, like Herman Kahn, who in the 1970s dared challenge the “settled science.” (Are you listening, global-warming alarmists?)

I need a product manager!

Friday, January 4th, 2008

I’m looking for a product manager to own defining the features and functionality of our product. Here’s the spec, please let me know if you know anyone. Thanks!

Senior Director of Product Management

Brand advertising dollars are skyrocketing on the internet, and publisher traffic growth is not keeping up, creating a pressing need for optimization tools that give publishers the inventory control required to capture these ad dollars. Yieldex is a venture-funded startup with patent-pending optimization algorithms, built by some of the folks who invented the first online ad systems at NetGravity and Matchlogic.

Our next key hire is a product person, someone who knows the ad operations side from inside and out, and can make sure the product we build has the “wow” features that deliver huge value to our customers, without neglecting the required functionality that customers need. Ideally this person has worked at a publisher or ad network between ad sales and the ad technology group, and knows both how the sales process works, and what existing systems are currently capable of. This position could be Senior Product Manager, Director or even VP level, but we need a doer, not a manager. This person will be gathering feedback from customers, writing functional specs, and working with the engineers on a daily basis to refine the product for the market. Key attributes are the smarts to integrate lots of complex input, the ability to work with both customers and engineers, and the organizational skill to make sure nothing falls through the cracks. Actual product management experience is a plus, but not a requirement.

The engineering team is located in Boulder, CO, and the business team is in San Mateo, CA. This position could be either location, but would require some travel between them, and in particular would need to spend time with the engineers in Boulder. There would also be travel to customers.

Please contact jobs at yieldex.com to apply. Thank you.

Sales is hard!

Wednesday, January 2nd, 2008

It’s clear to me now that I’ve always had an engineer’s disdain for sales people. After all, how hard can it be? Our great product practically sells itself. As a CTO, the sales calls I went on were all easy and almost fun. My job was to talk up the features and functionality of the product, and wow the customer with how smart we were and how great the architecture was at solving the problem they had. No problem. How little I knew about the constant follow-up, the customer requests, the research and preparation and effort that went into understanding an account well enough to close a million-dollar sale. Now that I’m the head sales guy, I’m learning the hard way. My only hope is that I’ve started to understand how little I actually know, and I’m getting much better at asking for advice and coaching.

I had a classic sales situation the other day: a champion at a top prospect who loved our product, and the next step was to vet it with the technology folks. We set up a conference call for two weeks out. Then it was rescheduled for two more weeks out. Then they sent an Outlook appointment update – not even the courtesy of an email or a phone call – to reschedule again for over two months later. Then our champion left. Poof – no more top prospect. Of course, as an entrepreneur we never say die, and I’m back in there trying to make progress, but this is the startup roller-coaster.