Startable – Healy Jones’ & Prasad Thammineni’s Blog

72 venture capital funds raised $7.5 billion in the first half of 2010. That is an increase of 13% (on a dollar basis) from the previous year. But it’s way less than the $14.2 billion raised in 1h 2008. Dow Jones has more info.

I attended Angel Boot Camp yesterday (June 1, 2010) at the Microsoft NERD center. It was a great event with something close to 300 angel investors gathering to discuss how to activate the angel community in Boston. Jon Pierce of the Awesome Foundation organized everything – nicely done Jon! Here are a couple articles/posts on the Boot Camp from the community:

Wade Roush of Xconomy published a great summary of the speakers main topics.

Also, Don Dodge put the key points from his talk up on his blog “The Next Big Thing.”

two more posts inspired by Angel Boot Camp:

Will Herman on Angel investing – why he does it and what he gets out of it, plus some ground rules for success.

Brad Feld on suggestions for angel investors.

And another Angel Boot Camp post:

Gabriel Weinberg was reminded of how much he likes backing hackers and needs to make more investments.

BostInnovation on the first sessions of Angel Boot Camp.

Hiring talent is one of the most challenging things facing a startup. Hiring the best programming and technical talent is even harder. Taking data from The Entrepreneurs Census, which I wrote about yesterday, we can get a glimpse into how hard it is to hire programmers in Boston, Palo Alto and New York.

It may be easier for startups in Boston to hire programmers than startups in Palo Alto

Startups in Boston may have a better time hiring programmers, as measured by how long it takes to fill an open position and by the percent of startups that have open positions.

Hiring Programmers in Boston vs Palo Alto

The two thirds of startups in Boston were able to fill open positions in under three months – verses about half in Palo Alto and 63% in New York City. (OK, the difference between New York and Boston is probably statistically insignificant.) Three months is a lifetime for many software and web startups; being unable to add a critical developer in that period of time could derail product launches and critical feature updates. Heck, a lot of startups are out of business in 6 months to a year, so if you can’t fill your positions by then who knows if it’s even worth still looking…

The data collected by the study would fit with anecdotal evidence that I have heard from friends starting companies in Palo Alto. Many people have told me that it’s impossible to find talent in the SF Bay area… especially at a reasonable price. I know it is hard to find good people in Boston as well, but this study would suggest it is a bit easier here than in Palo Alto.

Compensation of programmers in Palo Alto is higher than Boston and New York

And of course the other important part of the equation is how much it costs to hire talent. From the study:

Compensation for Programmers Palo Alto Boston

Doing some really crude math, it looks like programming talent in Palo Alto is 13% more expensive than Boston and 36% more expensive than New York. (I very roughly calculated that the average comp in Boston was $66.85k, Palo Alto 75.65k and New York $55.75k; I assumed the comp for each salary range was in the middle of each range for my calculation. Again, the numbers are small so the difference may not be statistically significant.)

The other data point in the above compensation chart that I’m trying to get my head around is low end and high end. The high end is easy enough to understand; you have to really pay up to get good talent in some cases in Palo Alto (and NYC). This doesn’t surprise me too much, but it is interesting that the high end is zero for Boston. Maybe due to a small sample set? I just don’t know enough.

The low end is also pretty intriguing. I’d bet that most of the sub $50k programmers are working for equity. It looks like regions OTHER than Boston have more programmers working for a pittance, trying to get equity. Does this mean that Boston has less of a founders culture???

Pretty ironic and not really very important, but Gmail decided to add in this little advertisement to the top of an email conversation that I’m having with someone about this post… it looks like Google is hiring developers in Boston!

I recently got a copy of a new study called “The Entrepreneur’s Census,” created by Matt Shapiro of Yale. There are some pretty interesting data points in the survey regarding startup in Palo Alto, Boston and New York City. As a person interested in growing entrepreneurship in Boston, something cool I took away from the census is that

Founders move to Palo Alto to start companies

and

Boston founders are likely to be students to came to Boston and then started companies

First, a little info on the census, as taken from the report:

The study originated in January 2010 as a project to understand the recent increase in entrepreneurial activity and investment in New York City… In March, we undertook the task of gathering granular information regarding the venture communities in Boston, Palo Alto and New York… We received response from 307 entrepreneurs. Collectively, these businesses have created more than 1,300 jobs and paid more than $7 Million in annual rent.

I believe that, as Scott Kirsner says, Boston’s greatest renewable resource is the students who show up every year. While a number of the people who found companies in Boston seem to be here because of their education, I’m not convinced that enough is being done to keep students in Boston after they complete their education. We need to actively support some of the efforts underway to make people feel more comfortable starting businesses in Boston, like DartBoston, Greenhorn Connect, TechStars and the Mass Challenge. (and I think something else that would make students feel more at home would be if the local road system/drivers could be a bit less third world and behave a little more like the rest of the country. Street signs and lane markers would be a good start.)

Secondly, there has got to be a way to make Boston more of a destination for starting new companies. I am convinced that Boston is by far the second best place in the entire world to start a software/internet business (I am saying that this is a really good thing!) and somehow the area to get more people to realize this.

Scott Kirsner recently let me know about a great upcoming event in Cambridge – the Momentum Summit (http://www.momentumsummit.com). The conference is bringing together experienced local entrepreneurs and letting them share advice with the local startup community, and sounds like a good opportunity for people like me to hear from people who have done it before. The conference seems to have a internet/online business angle, which is also pretty perfect for me!

Some of the people speaking have done some amazing things; some of the execs who caught my eye are:

Gail Goodman, Constant Contact CEO

Steven Kaufer, TripAdvisor CEO

Trynka Shineman, VistaPrint CMO

David Cancel, Performable CEO

According to Scott, the purpose of the event is to “ to bring in some of the most successful CEOs, founders, marketers, and salespeople from our region, and have them share their advice on how small companies developing great products can build really big customer bases.”

As a guy trying to grow OfficeDrop‘s customer base into something really big, it sounds like a good conference to me!

I also think that the proceeds will benefit a local non-profit, Stay In MA (a scholarship program for Massachusetts-based college students), which is an added bonus.

Congrats to the awesome team at Localytics, a mobile apps analytics provider, who has just raised a solid angel round. This is yet another Boston TechStars company that has gotten funding. Raj and the team are kicking butt over there!

The folks over at Wordstream have just raised additional capital. $6 million in a Series B from Sigma and Egan Managed Capital. Sigma is the return backer; the Egan is the new player in the deal. MediaPost has an interesting story about one of the reasons Egan decided to invest. Worth a read. And congrats to Wordstream, another Boston area company, on the fund raise.

Congratulations to Ben and Josh, founders of Woburn HQ’ed Incentive Targeting on their $2.35 million angel round! This is a great outcome for a group of entrepreneurs with a cool idea who have been working hard for the past few years. I first got to know Ben and Josh when I was with Atlas Venture, and I’m very pleased they fought hard and long enough to pull together such a big angel round.

Incentive Targeting helps grocery stores and other retailers make better targeted promotional decisions. It’s a bit like Google Analytics for retailers. Very innovative stuff in the retailing industry!

Something interesting on this round, and quoting directly from their press release:

The Series A round was syndicated across eight angel investor groups in the New England area.  The angel group syndicate, coordinated by River Valley Investors of South Hadley, Mass., also included Walnut Ventures, Hub Angels, North Country Angels, Boston Harbor Angels, Northeast Angels, Granite State Angels and Boynton Angels.

Wow, that’s a lot of angels! Getting a single group to make an investmetn is hard – pulling together 8 groups is pretty amazing. I now know who to call if a herd of cats breaks lose from any local animal shelter!!

I woke up this morning and realized I needed to check to see if I could use the water out of my tap to brush my teeth. We are under a boil order here in Boston due to a major water pipe break. Of course, I’m not going to go outside to get a paper before brushing my teeth. So I did what I think a large number of technically literate people did – grabbed my iPhone and went to Boston.com’s mobile site to see what the status was.

And I saw a huge fail.

Boston.com #Fail

Boston Globe's Mobile Site Fail

Scrolling down didn’t really help either:

No where on the first page of their mobile site did the Globe decide it was important enough to talk about the DECLARED STATE OF EMERGENCY IN BOSTON. That’s awesome. As if people care if they could get sick from drinking their water. Car bombs in NYC, Pops and the Celts losing (sigh) are all sort of important, but I’m pretty sure the fact that the governor has declared a state of emergency and that people are not supposed to drink tap IS MORE IMPORTANT THAN any of the stuff you put above it (with the possible exception of the Sox/Orioles pre-game coverage.)

It’s clear that the mobile site is tailored to a local audience – three of the four first things were about Boston area themes (Sox, Pops and Celts.) But if you are going to bother to “be local” why not include the most important local news? I’m pretty sure people care.

If news papers want to continue to exist they need to do better than this. The Globe has recently been in the hot seat, with threats from their owner the Times to shut the paper down and tense negotiations with different unions. People in Boston were pretty upset that we might lose our major paper. But guess what – if the paper can’t deliver the news effectively in today’s mobile world, I’m not sure it’s really adding that much value. I realize that a major component of news papers’ declining fortunes is that they are losing paper-based ad dollars and that the ad dollars from their online properties can not replace the revenue decline due to lower CPMs. But unless I’m mistaken, it’s the content that drives readers – online, on paper or on the phone – and if you can’t deliver good content quickly in the right medium then you have no reason exist.

At least the regular Boston.com had coverage front and center on the water issue this morning. Maybe the team that runs the mobile site should connect with the web site’s team and find out what’s really going on – then publish that so that people like me, who want to use your mobile site – can actually know what is going on.

I’ve got news for Wade Roush of Xconomy – the Barron Building in Central Square better not be the new Boston “startup hub.” Because otherwise, we are all going to die.

See the following tweet stream captured in my Tweetdeck account, from 9:42 to 9:51 pm tonight:

On the plus side, there is AT&T reception in the elevator. Maybe the only place in Boston where you can get 3 iphones all online at the same time!