Wednesday, February 6, 2013

Monoprice is killing and so can you!

Bad luck Brian meme - bought a $100 hdmi cable loves the improved picture
This is an open love letter to  I love and I'm proud to tell everyone.

It's also no secret that I love Amazon, but that is a blog post for another time.

Monoprice does something that any tech nerd like me would love - they offer tech knickknacks at rock-bottom prices. In fact, I first heard about Monoprice from a contractor who I was going to hire to hang my TV above my fireplace. He had asked me if I had a bracket to mount the TV. I said no, I've been shopping around but I have not found the one I want yet. He recommended that I should definitely check out Monoprice because they have a solid selection and the lowest prices. I was a little curious at first because the name sounds a little too techie. I was blown away by what I found, and I have been a loyal shopper there ever since.

Buzz feed just today posted an article about how Monoprice first got its start. The CEO started wholesaling direct consumer HDMI cables. The thing about HDMI cables is that they are data cables. They transfer ones and zeros from your TV to your source and back. This is very different from the previous generation of cables that were analog and transferred a signal that could be degraded by a crappy cable. This does not happen with digital cables because as long as the ones and zeros get to where they need to go, the quality will be the same no matter how much you pay for your little cable.

Best Buy, who I have an unending hate for, was fleecing people on HDMI cables. Their Monster brand of cables were great. once upon a time when I worked there. when they offered high-quality heavy gauge video cables for component and composite setups. The colors were never washed out and you could count on getting the best signal from your source to your TV. When the digital age rolled around and HDMI set the scene, their primary value proposition evaporated overnight. As mentioned above why would you pay for expensive cable that did the same thing as a cheap cable? I'm sure there are some people out there who were duped by Best Buy associates based on the claims that Monster brand continued to make on this new technology.

Monoprice hit the scene with HDMI cables of every color and length possible at a fraction of the cost. No longer retailers pulling a fast one on consumers. Unless there was some sort of HDMI emergency, there was no need to go to Best Buy or target and spend $30 or $40 on the exact same cable that you can get from Monoprice in the mail in three days for two dollars. And it would be a pretty blue or green to boot.

At this point, you're probably asking me what Monoprice and this HDMI story has to do with this startup blog. If you have not figured it out already, Monoprice saw an opportunity to solve a problem. They solved the problem so well, they are putting the hurt on brick and mortars and continue to kick ass.

Just this month, they announced they were going to self brand an IPS monitor. When I saw this in my inbox, it definitely gave me a double take. This sort of monitor is definitely new-ish technology, in-plane switching (IPS) monitors are used by graphic artists and rich kids with too much money and too many video games. Monoprice has transitioned from undercutting brick and mortars on accessories to undercutting them on the sort of products that keep the brick and mortar doors open. If Best Buy's margin disappears, Best Buy disappears.

The moral the story, Monoprice started as a warehouse full of HDMI cables. Humble beginnings. If you solve your own problem well enough, your humble beginnings may turn out to be the next

Best of luck.


Tuesday, February 5, 2013

No money for development? Try reverse incubation!

The Most Interesting Man In The World - i dont always create startups but when i do i have someone else code it
Development is not cheap. Correction: quality development is not cheap. If you believe you have a startup idea that's really worth funding or building, but you don't have the funds, there may be an answer for you.

If you've been in the startup space for a bit, I'm sure you've come across the term "incubator." If you're not familiar with this model, you should look into how it works. In a nutshell, an organization will seed a bunch of fledgling ideas and developers to offer them assistance with building the business and help them get off the ground. I once heard it described as an MBA program for startups; it's expensive, you learn a little bit, but the most important thing are the connections that you make while there. I'm not saying that they are all evil. I'm sure they're very helpful to a small margin of startups. After all, it doesn't hurt to know the people who could eventually find your startup one day, right?

These big incubators, or even the small ones, make money by getting that home run start up to be funded perhaps 2% of the time. That means that 49 out of 50 startups collapse, but the VCs of the incubator are able to get in on the ground floor for an idea that will turn out to be extremely lucrative.

The thing about many of these incubators is that they give you a small amount of money to develop your startup, literally coding yourself while eating ramen noodles out of your apartment or their loaner office. If you saw the movie The Social Network, Zuckerberg and team did this out of their rental California home. (PS, it was a lot more work than they make it seem on TV.)

Problems arise with this type of model. What if you don't know how to code? What if you don't want to eat Ramen noodles? What if you have a day job, bills, and live in the real world? There is still a way to get your software built.

Enter Reverse Incubation. Instead of you maintaining your own software and sharing a large portion of initial equity with the incubator for a ridiculous sum, we can build it for you. You can have your software built while maintaining ownership of the platform and control the company. The best part is we can do it for little to no start up revenue, depending on the size of the effort.

Make no mistake, this is an equity sharing model just like regular incubation.  Based on the initial valuation or perceived valuation in the short term, we can provide you with CTO-level services and project management for an extended period of time.

Something especially interesting happens with this model. There is extra incentive for us to do the best job possible since we are financially obligated to you, instead of the other way around. We have a  literal vested interest in ensuring that your startup succeeds. It's not just a small amount of seed funding that is on the line, it is our time, effort and reputation.

Curious? You can contact me through this blog, leave a comment, or contact me through

Friday, February 1, 2013

Solutions are Startups

Futurama Fry - Not sure if dumb idea for startup or the most freaking genius idea ever
Solutions are startups. If you have a solution for problem that a segment of the Internet population is experiencing, you have a great idea for startup. Every startup that has ever existed has been a solution to one problem or another. This is kind of a fun game I like to play, actually. Think about any website and then try to name the problem that it solved.

EBay solved the problem of people needing a place to conduct safe, private party transactions.

Facebook solved the problem of MySpace being clogged with spam (get your free iPhone now!)

Groupon solved the problem of empty spas and sushi going bad.

I kid Groupon and Facebook, but the idea has merit. did over 200 individual software projects last year and almost all them solve a problem of some shape. Just off the top of my head, I had a client who created a marketplace for ordering entire crops of farmers produce, another who is creating a marketplace for their local area to support local commerce, and another who wants to set up a marketplace to trade sports jerseys and shoes.  Each of these marketplaces solve a problem that has commercial value to those who need a solution.

The moral of the story here is that if you can quickly identify what the core problem is that you solve, you can better target the market who has that specific problem... and then market to them.

I don't want to end the blog post on a bad note, but if you want to start your own website and you cannot answer this question, you may be in trouble already. I meet people all the time who want to start a social network or a dating website, but they do not have a focus for who they are trying to market to or what problem they are trying to solve with their start up. I never discourage them, because you never can tell where lightning will strike next, but if one tries to start a generic social network they are essentially dooming themselves to compete directly with Facebook. Is it possible to do so? Absolutely. But you better have really deep pockets if you want to play in that league.

To take a minute, think about what problem you're solving and that help you to determine your niche market and your path to success.