Archive for the ‘In Brief’ Category

Startups Need to Change Their Cultures in Cockroach Era

Thursday, June 9th, 2016

As unicorns go out of style with VCs, the glossy, idealized cultures of startups will need to change.

A recent article from TechCrunch notes that free-flowing VC funding has softened startups and perpetuated cultures that focus more on small wins like offices and sought-after hires, rather than big wins like building a strong customer base and generating revenue.

Unlike mythical unicorns, cockroaches don’t require palatial offices, onsite chefs, and playgrounds consisting of pool tables and arcade games. They are perfectly comfortable with a dingy basement, relying on scraps for sustenance.

This shift in culture may be a trade-off in attracting top talent, but one that should benefit startups in the long-run. Miriam Diwan, a former portfolio manager and the co-founder and CEO of NowMoveMe, tells Inc. that “the employees looking for Facebook or Google levels of perks are not the best fit” for startups.

Similarly, YCombinator president Sam Altman says “the people who get hurt most often are employees at these startups who look at these valuations and think they aren’t pretend.”

Cultural change can be difficult for any organization. A key challenge for startups is to ensure that changes are aligned with long-term strategic plans and organizational values.

‘Life is Good’ For Simpler Startups

Thursday, June 2nd, 2016

While many startups may have a desire to change the world, tackling a small problem can be simpler, more viable route to success. According to a report on Inc., Life is Good is valued at $100 million, having built its brand simply on combating negativity. The company sells everything from T-shirts to stationery, some of which feature its now iconic stick-figure character, Jake.

Life is Good: Jake

Life is Good is not the only startup taking a simpler approach to success. Startups like Israeli-based Gigya (data analysis) and Minneapolis-based When I Work (employee scheduling) are solving specific problems that companies face every day – and it’s paying off. Gigya is on its way to a billion-dollar valuation.

Point solutions – apps that also provide an answer to single, simple problems – are also prevalent in fintech, with startups like Trulioo and ChangeJar chipping away at big banks, one product or service at a time. When it comes to funding, Venture Capitalists are increasing looking for startups with a problem-solving mindset.

Simplicity is also key when making development decisions at the onset. Martin Weiner, CTO of Reddit, emphasized this point at a SXSW interactive conference held in Texas earlier this year. He advised that startups focus on “technologies that will help systems scale quickly, and are easier to employ.” This includes building with what he calls ‘boring tech’ – proven technology that works at any scale.

In the early stages of creating a startup, boring might be the right way to go.

US Postal Service Considers Adopting Digital Currency

Tuesday, May 31st, 2016

You’d expect the likes of Nasdaq and Goldman Sachs to already be part way to adopting digital currency. But the US Postal Service is also eyeing the technology, known as the blockchain, as a way to reinforce its supply chains and grow its share of the financial services market.

The blockchain differs from the traditional banking record in that all financial transaction data are contained in a distributed ledger. This removes the centre of power from individual banks, and vastly increases security as multiple copies of a ledger where one entry depends on another (the “chain” in the blockchain) cannot be interfered with after they are filed.

According to CoinDesk, the Postal Service’s Office of the Inspector General (OIG) released a report that says ‘PostCoin’–either adopted from an established cryptocurrency or created by the government agency itself–could be used by customers to send international money transfers to a far larger number of places than its currently limited scope.

Blockchain technology could even be connected to pieces of mail for supply chain management, for “timely sharing of information and processing of payments”: while the report acknowledges that it may be somewhat impractical to attach a unique sensor to every single item of mail, the USPS could use its size to encourage adoption.

Randy Miskanic, the US Postal Service’s Chief Information Security Officer and VP of Digital Solutions, is urging caution because of security and regulatory uncertainty. This means there might not be a PostCoin particularly soon.

“We will evaluate the use of blockchain for each of the use cases and further review the available opportunities while considering the impact of the technology and financial restrictions,” he says.

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Montreal’s #Startup Social Media Discussion

Tuesday, May 17th, 2016

“Venture capital matters” dominate the Montreal tech startup scene, according to what the data shows around Twitter discussion from Canada’s second largest city:


Montreal is home to some of Canada’s largest VC firms, including Real Ventures, Rho Canada, BDC Capital and iNovia Capital. The city also made Compass’ list of top startup ecosystems globally:

After funding, physical accommodation for startup activity shows up prominently in the Montreal social media discussion in the last 90 days. Notman House – a startup campus providing office, event, and communal space for entrepreneurs, investors, technology partners and community groups – has attracted 3.3 million Twitter impressions from nearly 1,000 mentions in the last 3 months.

Notman House aims to contribute to Montreal’s startup ecosystem by “producing companies that contribute to the social, economic and cultural fabric of [Montreal] while shaping the future of our global society,” according to the organization’s website.

Opportunities to work at, or with, Notman House drive the social media discussion:

Notman House has a very international view to its place in the world, saying its vision is “predicated on the beliefs that not only do startups make cities great, but that great cities need great startups.”

Want a look inside Notman House? Here’s a 3D tour:

In addition to Notman driving Twitter discussion around the Montreal tech #startup scene, is one person: Sylvain Carle, a Partner at Real Ventures and General Manager of FounderFuel.

Known as “@froginthevalley” on Twitter, Carle has proven to be both a supporter of Notman House, and a driving force of Twitter discussion in Montreal recently.

Carle ranks as one of the more influential Twitter users talking about startups in Montreal, alongside MontrealNewTech, Montreal Tech Watch and Sebastien Provencher.

Want to browse through Montreal’s startup community? Here’s a start:


Mind the Startup Leadership Team Gap, Investors Say

Monday, May 16th, 2016

Startup entrepreneurs know going it alone is seldom a good idea. But a senior “team” with only one kind of speciality – be it engineering or product development – can be equally as difficult.

Sonia Strimban, manager of venture operations at Toronto’s MaRS Discovery District – an accelerator, said one of her first interventions when a company joins is to make sure the right blend of leadership is at the top.


“You absolutely need a team,” Strimban says. “Nobody is going to give you money for an overdeveloped product without a business model.”

Strimban adds that it’s important to plan your leadership team for growth at different stages.

“At series A, typically, we see the most benefit in an executive in sales and marketing. If you’re not selling and you can’t accelerate growth, you’re pretty much toast. [You need] somebody who has revenue growth capability.”

This is particularly true now that VCs have pivoted away from startup unicorns in favor of the unstoppable cockroach.

Other investors concur about the risks inherent in single-person or unbalanced startups.

David Cohen, a co-founder and managing partner at Techstars Ventures, said in a 2007 blog post that he won’t rule out sole entrepreneurs, but holds them at a disadvantage. “Look for someone who compliments your skills,” Cohen said. “If you’re great at coding, find someone who’s great at selling or marketing.”

Cohen’s investment instincts proved astute as Techstars became an early investor in Uber just two years later.

Location is a Factor

Location can also often become a factor in finding the right senior team lineup.

“The U.S. definitely has many layers of experience of people in robust urban areas,” explains Gregory Melchior, Founder/CEO of startup 4D Virtual Space.

Some areas such as Greater Boston or Silicon Valley have a wider spread of skills at founder level. “There seems to be a correlation between the top universities – institutions have a ripple effect – that allows for a robust labour force.” Melchior adds.

However, finding co-leadership you can trust is now almost as easy as swiping right. Sites such as FounderDating aim to bridge the leadership gap by connecting leaders with different and complementary skills.

And true to their word, these platforms screen applicants so their base doesn’t get top-heavy with engineers.

WIRED: Magic Leap Stands Out Among Giants in the Artificial Reality Race

Friday, May 13th, 2016

Artificial reality is making waves throughout the tech industry, and Magic Leap has made one of the biggest splashes in terms of financing. The company has secured what may be the largest C-round in history: $793.5 million.


Fort Lauderdale, FL-based Magic Leap will need to spend wisely to compete with the tech giants of the west coast and Asia.

A recent profile of Magic Leap in Wired noted that “Facebook, Google, Apple, Amazon, Microsoft, Sony, Samsung—have whole groups dedicated to artificial reality, and they’re hiring more engineers daily. Facebook alone has over 400 people working on VR.”

By 2020, the augmented and virtual reality markets are expected to be worth about $150 billion. This is creating hardware and software development opportunities for startups in just about every industry and facet of life, from film to education to day-to-day office administration.

But the potential applications could spill over combine with other emerging technologies. As we enter virtual worlds, the demand for IoT devices and smart-connected spaces could increase. The combination of virtual space and IoT tools has the potential to revolutionize industries such as skilled trades, healthcare, and tourism.

As startups plan for the future, it is worth considering if virtual reality will disrupt their business and how technologies like Magic Leap might impact them. Until Magic Leap unveils what it’s hiding, the true extent of its impact can’t be measured, but until then, it doesn’t hurt to imagine.  

What Do You Call a Canadian Unicorn?

Thursday, May 12th, 2016

The ups and downs of unicorn valuations have dominated the Twitter conversation around tech for much of the past year, both in Canada and elsewhere. How does Canada differentiate itself when referring to startups valued at $1 billion or more?

The mighty narwhal.

While this carnivorous whale – distinguished by its single tusk – is an actual creature as opposed to a mythical one, try to find someone who’s seen a narwhal in the flesh. The animal’s scarcity makes it an appropriate metaphor.

There have been more than 1.8 million impressions from 175 mentions by 124 users between October 31 and April 30. Here’s what the conversation looks like:




Narwhals Are the Unicorns of the North


Carl Franzen, Online director at Popular Science, likely found that paragraph of text in a syndicated version of this story from the Canadian Press: Evolving B.C. Tech Startups Threaten to disrupt ‘dinosaur’ industries. Indeed, one of Canada’s most famous unicorns narwhals is Vancouver, B.C.-based Hootsuite.

Who are the other narwhals? Check out Visual Capitalist’s handy infographic from October 2015:

Unicorns & VCs

Unicorns haven’t been completely sidelined in Canada, though. The unicorn conversation often includes talk of venture capital. One example is this tweet from Startup Canada, which appears in the Twitter conversation:

The episode featured here is an interview with David Nault, a principal at  iNovia. You can listen to it here:

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VCs are not only talking about the industry on podcasts. Another story that bubbled up in the Twitter conversation was this PE Hub Network’s article on 2016 predictions for Canadian tech startups and venture capital.

Written by Jim Orlando, the piece explores IPOs, virtual reality and augmented reality, and an increase in activity from U.S. venture investors.  

For more on startup monikers, check out our piece here on how the cockroach crawled into tech sector parlance.

Under Armour Leverages IBM’s Watson to Challenge Fitbit

Thursday, May 12th, 2016

One of the biggest brands in athletic wear is charging into wearable tech with a pack of products and a pair of tech industry partnerships. Under Armour is leveraging artificial intelligence to give its offering an edge over competing products from Nike and Fitbit. 

Retailing for $400, HealthBox is a trio consisting of a Fitbit-like band, a digital scale and a heart-rate monitor. And UA isn’t starting from zero in its effort to tap demand for wearables.

Over the last few years, the company has snagged three massive online fitness communities: Endomondo, MapMyFitness and MyFitnessPal. They now control the largest online wellness-focused ecosystem, at 165 million users. And it’s what HealthBox can do with all that data that makes this a compelling package.

Under Armour partnered with HTC to develop the hardware and a smartphone app called UA Record, which ties all the products together. The UA fitness tracker is cleanly designed, made of a rubber-like material with a LED display. The heart rate monitor is constructed of durable band and the monitor glows when it detects a heartbeat. The scale measures weight and BMI. All the data from the three devices talk to each other and transfer data via Bluetooth to UA Record.

Cognitive Coaching

Under Armour’s partnership with IBM and the “cognitive coaching” potential of Watson differentiates HealthBox from the competition. By feeding nutrition, training, and sleep information into Watson, it’s “able to understand data in large volumes, make recommendations, and continuously learn,” says Chris Glodé, Under Armour’s VP digital, connected fitness. “The more data UA Record inputs, the smarter Watson becomes.”

UA has experimented with Internet of Things in the past. They built a sensor-laden compression T-shirt back in 2011 for the NFL Combine, where college stars worked out for prospective pro teams. The shirt provided raw data on acceleration, speed and heart rate for scouts to pour over. HealthBox and the partnership with IBM means that the Record app will be able to send the data to Watson to disambiguate.

Watson’s Cognitive Coaching uses a comparative model, grouping users based on criteria like age, gender and activity level in order to provide training and recovery recommendations.

And the experience will get richer over time.

“As you record more data and as more data is recorded across the community, the smarter the insights will become,”  Glodé says.

The Downside of Jobs in the Startup Era

Wednesday, April 27th, 2016

Enthusiasm over the economic benefit of tech startups needs some grounding, particularly when it comes to jobs.

While we argue in TechPORTFOLIO that startups have ended the industrial era, we should also acknowledge that many of the jobs startups create are fleeting and short on benefits. Moreover, the sheer number of traditional jobs in industries that grew throughout the 20th century make them a vital component of most economies even if their numbers are in decline.

The following stats help put the importance of startups as employment drivers into perspective:

Startups can create a large number of jobs, but can also lose a large number too.

In a 2015 study, Stanford Graduate School of Business professor George Foster examined more than 158,000 startups across the world, looking at each for five years. He found that jobs shed by companies in their fifth year equal 65 percent of that year’s new hires. This number, which shows the difficulty many companies have transitioning out of their startup phase, doesn’t account for jobs shed by startups that go bust. Nor does it count jobs lost as a result of startups disrupting a traditional industry.

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In years three, four, and five, only 8 percent added new jobs. Foster shows startup job graphs less like a slapshot — with rapid year-on-year growth starting from zero – and more like “a high-speed game of snakes and ladders.”

A minority of startups account for the majority of startup revenue and job creation.

The Stanford study also shows that among five-year-old companies, the most successful 10 percent account for 80 percent of revenue and job creation. That successful 10 percent also accounts for a lot of job loss, because companies can only lose money and jobs if they make it in the first place.

Though startups are creating jobs, companies like Google and Amazon aren’t even among the top 50 largest U.S. employers.

As Tech Republic notes, tech giants like Google and Amazon touch many facets of our lives, however they don’t come even close to companies like Wal-Mart (2.2 million employees in 2015), McDonald’s (420,000 employees in 2015) and Home Depot (371,000 employees in 2015) in job creation.

Less than 1% of the U.S. labour force is employed in companies established after 2000.

In a study by Oxford economists Thor Berger and Carl Benedikt Frey cited by Re/code, startups aren’t necessarily the job-creation engines they’re supposed to be. While IBM employs more than 400,000 people, Facebook has barely  7,000 employees. Part of the reason startups don’t hire as many people is because they often have software taking care of many human tasks.

According to a prediction by Carl Benedikt Frey and Michael A. Osborne from Oxford Martin School & Faculty of Philosophy in the UK, “47 percent of total US employment is in the high risk category, meaning that associated occupations are potentially automatable over some unspecified number of years, perhaps a decade or two.”

Startup jobs are often riskier to take than a job at a mid-size or large firm.

According to a 2014 Robert Half Technology survey of 2,300 IT professionals, a combined 84 percent said they would prefer to work at a mid-size or large firm. As Sarah McMullin of Camino Information Services explains in an article for Monster, one can expect lower pay, fewer benefits, and working longer hours. Startup employees are often on their own in saving for retirement.

But, you won’t find job prospects improving in the industrial sector.

For the past decade, growth in the U.S. industrial sector has lagged its average growth rate tracked since 1920. Growth topped the historic average of 3.79 percent in only 15 out of 120 months ending March 2016, and has been in negative territory since August 2015, according to U.S. Federal Reserve data. Industrial output in China, Europe and other regions has either seen declining growth rates, or outright decline.


The factors behind these numbers, including slower population growth, make it unlikely that industrial production will return to robust increases seen in earlier decades. Bring automation into the equation, and prospects for well-paying, full-time jobs with full benefits in the industrial sector weaken further.

While tech startup jobs still only account for a small portion of the labor pool, and might not offer the ideal in terms of job security and benefits, they will only grow relative to employment in the industrial sector.

Moreover, as technology developed by startups continues to occupy larger areas of our lives – from social networking to environmental remediation – jobs associated with these companies will become as important as assembly line work from a century ago, if not more.  


Fans Getting Closer Than Ever to Tour Action Thanks to the IoT

Wednesday, April 27th, 2016

As the official technology partner for the Tour de France, Dimension Data is changing the spectator experience of the world’s most prestigious cycling race with the IoT. Using IBM’s InfoSphere Streams analytics platform, Dimension Data monitored the real-time geolocational data of almost 200 riders over 21 days.

Every bicycle in the race was equipped with GPS sensors and a sophisticated relay system that transmitted data to apps, websites and broadcasters, giving fans and media the ability to track a rider’s progress throughout the race. The experience was no longer limited to a manual process that involved radios, stopwatches, and chasing riders on motorcycles to read the numbers on their shirts.

Dimension Data’s IoT solution provided a “positional fix every second, the latitude and longitude and the speed of every single rider,” IBM Asia Pacific’s Big Data Technical Leader Chris Howard told ReadWrite. “And from that raw data, we then did lots of things to determine their journey so far, how far they’d progressed, the ranking of the riders, the distance and times between all of the riders.”

In the future, a related IBM technology known as Quarks will provide cycling fans, broadcasters and team strategists deeper insights during the Tour. Quarks is an open source platform that lets developers create IoT applications to analyze data on the edge of their networks.

Howard believes that sensitive information such as “power output data, cycling cadence, pedalling cadence, respiration, [and] heart rate” could be gathered and used in a competitive nature.

To read more about how IoT is disrupting the Tour de France, please click here.