Author: Albert Ciuksza (Page 8 of 8)

Reactions to AlphaLab Demo Day

October 14, 2009 / Albert Ciuksza / 0 Comments

AlphaLab Logo

Instead of a summary of each company (Alan Veeck ( @aveeck ) at Meakem Becker Venture Capital and author of Pittsburgh Ventures blog did a fantastic live blog roundup of the companies here), I’d like to toss out some gut reactions to the companies, presentations and the feel of the environment overall.

In monitoring local media, it seems like there has been a lot of funding activity in the region recently, from early stage angel investments to larger acquisitions of Pittsburgh-based startups. That feeling of optimism was present at the event today as well, and from the folks I was able to speak with, there might be more good news coming down the pike.
It was great to hear about some of the success stories coming out of AlphaLab. One of my personal favorites is a company called The Resumator, led by Don Charlton ( @TheResumator). They’ve gotten some serious press and some seed funding post-AlphaLab, which is helping them to expand their feature set.
Social is everywhere. Absolutely everywhere. It’s hard not to get sick of hearing about it, but it really doesn’t make it any less important. I’m reminded of when everyone was talking about the internet being game-changer in the late 90’s-to-early-’00s — while it was so annoying to hear, the folks saying it were absolutely right.
The actual design of the various PowerPoint presentations was pretty good. I know it sounds superficial, but a stylish presentation makes a company look much more “together”. Great job, everyone.
Loved the presentation by Nick Pinkston, CEO of CloudFab ( @cloudfab). I continue to believe that storytelling and metaphor are the best way to connect with an audience, and I think Nick did a very good job of doing just that. Speaking with him afterward (both about his company and about using his technology to develop some components for a project on which I’m working), it was evident that he sees this as a product customization revolution rather than simply a sourcing opportunity. I love the vision.
Fooala has developed a site called CollegeBite ( @collegebite), a very cool open ordering platform that enables restaurants to create/expand an online presence using mobile and the web. One of the things I loved about it is that I’ve already used the site! While the presentation was a bit difficult to follow at times, I did find the team to be very, very strong. Finally, they’re classic Gen Yers — smart, mobile, experienced, passionate, hungry and making a difference. Two of the guys are from Duke, one of whom met one of the CMU founders while in Sydney, Australia. What a story.
Brian at NavPrescience has a compelling pitch — a software package that is integrated into GPS functionality that learns your driving habits and adjusts routing and point-of-interest suggestions accordingly. One of my favorite lines of the day was Brian’s deadpan delivery of “[GPS] devices are pretty stupid”, referring to the dictionary definition of “slow to learn and understand”. As a recent owner of a BlackBerry Tour with GPS capability, I’ve found how dead wrong TeleNav can be with even the simplest of directions (he cited that only 35% of GPS routes are actually ‘fastest’, confirming my experience). Brian’s use of a scenario in his presentation (there’s that storytelling again) was very engaging. Things that I disliked are mostly brand-oriented — I’m not a fan of the name (I keep wanting to say NavPresence and the word ‘prescience’ is a bit SATish) and the logo is a rough (use of Verdana, complicated design and the invocation of magic when the system is built on three years of solid R&D at CMU). I know that the company isn’t looking to sell to consumers, but it’s still something that could be improved.

While it’s a tough time for everyone in this economy, I’m really optimistic about the entrepreneurial community here in Pittsburgh. Being named the second-best place to start a small business in the U.S. doesn’t hurt, either. All-in-all, I have to commend AlphaLab Class #3 on a job well done.

Pittsburgh Named Second-Best Place to Launch a Small Business

October 13, 2009 / Albert Ciuksza / 0 Comments

This is just great news for the region. The more people realize how economically viable this region is for small businesses, the more robust the entrepreneurial community will be. While the challenges this region faces are pretty well documented, this type of press is really important.

http://money.cnn.com/smallbusiness/best_places_launch/2009/snapshot/258.html

Update: For those who don’t want to click through…

Greater Pittsburgh is home to a workforce with hard-won manufacturing skills from the city’s steelmaking past. Need machinists? They’re here — and that’s a draw for small businesses.

The region combines that talent pool with a mix of highly educated students from the University of Pittsburgh, Carnegie-Mellon University and Duquesne University. Those institutions helped make Pittsburgh a leader in robotics, healthcare, and artificial intelligence. Locals cite the city’s culture as one of its biggest selling points: There are tight-knit neighborhoods, many built around eastern European communities that prize a strong work ethic.

Most of the city’s small businesses are family-owned concerns that have morphed to serve new markets. Resources like the Institute for Entrepreneurial Excellence help both startups and generations-old companies get the skills they need. Pittsburgh’s location on major North-South and East-West interstates connects companies with distant markets and suppliers.

State taxes aren’t low, and the recession-fueled tax shortfall hurts: The state may have to take over Pittsburgh’s pension system. But small businesses say the local workforce is resilient, and with valuable, transferrable skills.

To Offshore Or Not To Offshore…

October 12, 2009 / Albert Ciuksza / 0 Comments

I was discussing with a couple of folks who work with entrepreneurs and startup companies a rough design and production plan my team was planning to use in a venture we’re in the process of launching. One of the strengths of our plan, I said, was the use offshore design and production, which will allow us to sell our product at a beyond-competitive price (more than half than our next competitor). One of the people with whom I was having lunch turned to me and asked, “do you really feel comfortable with using foreign labor?” He was making a significant point with a simple question. I justified the decision, saying that I knew the people involved in managing the manufacturing facility and was aware that each employee was paid well, was provided with health care for themselves and their families, worked reasonable schedules, and worked in a safe environment. However, no matter how well the employees are treated, the fact remains that production isn’t happening in the U.S.

On one of my first major projects, I had fought for using for domestic manufacturers to produce some of our components. While the management team believed that we couldn’t get a competitive price in the U.S., I insisted that we price all of our parts domestically. The result? Most everything we priced was four-to-10 times more expensive in the U.S. than through our international suppliers. While there were arguments to be made that the savings weren’t worth the opportunity cost (time between ordering and getting the product in the door, for instance), it was almost universally impossible to make our margins work using domestic suppliers.

Since those early fights, I hadn’t really thought about domestic vs. offshore supply chain. Every project in which I’ve been involved has used an offshore provider in order to be price-competitive. I realized that I had moved on from the ‘Buy American’ value that had been passed down from my grandfather, a foreman in the famous Homestead Steel Works.

It’s not just in physical product development. At a presentation I attended at AlphaLab last year, one of the portfolio companies, a social networking web site geared toward a specific audience, openly discussed their use of Indian programmers. It struck me at the time — for a city like Pittsburgh that is so rich in IT talent, it still made sense to offshore the work.

I’m truly conflicted about this issue. On one hand, I think it’s important to support U.S. jobs in order to maintain a robust economy. On the other hand, few startups can raise the type of capital, and make workable margins, using domestic labor and suppliers. How can entrepreneurs pass on the opportunity to increase their product margins, which will make their companies more likely to be funded, financially successful, and viable? Is this an ethics issue or values issue? Do entrepreneurs really have a choice?

Inventors Should Learn From The Green M&M

October 9, 2009 / Albert Ciuksza / 0 Comments

Green M&M

During the Spanish Civil War, Forrest Mars, Sr. saw some soldiers eating little chocolate pellets surrounded by a sugar shell, preventing the little pieces of chocolate from melting. He perfected the process, patented it and, along with Bruce Murrie, began production in 1941 exclusively for the military. The candy hooked thousands of GIs and the company began selling to the general public after the World War II ended, establishing M&M’s (Mars & Murrie) as one of the best-selling chocolates in history.

In nearly 70 years, the product has grown from a treat for soldiers to one of the most extended products in the world, with multiple fillings, flavors, customization options, colors and sizes that are sold in stores ranging from gas station stop-and-gos to the massive M&M’s Store on the Las Vegas strip.

What can entrepreneurs learn from Mars and Murrie? The customer’s vision (and money) drives product direction, not the entrepreneur. If Mars had stuck with his original product vision, the product would be relegated the memories of those who fought in World War II. There never would have been the addition of peanuts in 1954, peanut butter in 1990, the blue M&M in 1994 or a wall of “My Color” M&M’s anywhere. Certainly, there never would have been a customer-driven rumor that green M&M’s are an aphrodisiac, which has led to product extensions itself (bags of green M&M’s sold on Valentine’s Day, the sultry female M&M character featured in much of the company’s advertising). While there’s market research behind the moves that M&M’s makes, customer demand drives the vision of what the next M&M innovation will be.

One of the greatest challenges that inventors face is internal. Many inventors, who have invested countless hours and dollars perfecting their product, become so closely aligned to their own innovation vision that they lose sight of the customer. They restrict the vision of the market that they’re creating, which turns off potential customers, investors, champions and referrals. This eventually leads to game-changing technologies dying on the vine because the inventor thinks they’re smarter than the market.

Inventors and entrepreneurs must realize that they lose control of their product the minute they develop it. As soon it goes from concept to execution, the customer dictates whether or not the product is viable and what improvements should be made. Customers are smart. Follow their lead. And always remember that it was the customer, not the inventor, that created the green M&M.

Gen Y and the Entrepreneurial Opportunity

October 6, 2009 / Albert Ciuksza / 0 Comments

Generational issues have been a hot HR topic for years, and the urgency to develop a plan to integrate these generations is becoming even greater now that economic factors are forcing Baby Boomers to stay in the workforce longer than they anticipated. Along with this phenomenon, the workforce is integrating Gen Y workers, a group that brings a very different skill set — and expectations — to the workplace. The anticipated workforce shortage that scared executives earlier in the decade is now simply a non-issue.

This presents an interesting challenge for Gen Y. What once appeared to be a fast-track to positions of authority as older workers retire is a now fierce competition for available jobs, a fight that pits early-career professionals with much more experienced counterparts. For Gen Yers lucky enough to have a job, the opportunity to move up and contribute to meaningful projects (identified by Herb Sendek and Buddy Hobart in Gen Y Now to be one of the major needs of Gen Y workers) has decreased considerably.

The challenge, as Hobart and Sendek identify in the book, is leadership. Many Baby Boomer and Generation X managers have negative perceptions of Gen Y, which lead to managerial decisions that hurt everyone, i.e. the manager doesn’t get out of the employee what he or she needs and the Gen Y worker in turn doesn’t get the fulfillment/experience that they are looking for. The inevitable consequence is that the Gen Y worker “checks out” and eventually moves on. This situation is often blamed on the Gen Y worker (they’re lazy, they’re entitled, they don’t try to fit in, they’re babied, they’re spoiled, they’re not willing to ‘put in their time’) as opposed to the individuals who are leading them. For both short- and long-term results, organizations simply can’t function this way and hope to be competitive in attracting/retaining talent.

However, where larger organizations might falter in assimilating Gen Y talent, start ups and smaller entrepreneurial companies can thrive. There are several reasons: Continue reading

Customer Service That Is Done Well

October 5, 2009 / Albert Ciuksza / 0 Comments

A few weeks ago, after a long struggle, I lost a companion of more than a year-and-a-half — my BlackBerry World Edition (8830) from Verizon. It was a great phone, surviving heavy drops on pavement and enduring more than one text battle with friends and significant others, but was on death watch for about a month. Finally, after an accidental dip in the sink — and the periodic malfunctioning of the left half of the keyboard — I decided that it was time to let go.

I had been following the progress of the BlackBerry 9630, eventually named the Tour (for the record, I did this with the other BlackBerry out of the room lest I offend it and it delete all of my text messages). The Tour boasted some great features that had limited the world edition — more memory, better screen resolution, a faster processor and a camera. After stopping into the Verizon store on Smithfield in downtown Pittsburgh on numerous occasions, I knew that it was the right phone for me.

The team at this Verizon store is always excellent — they move people through quickly, are courteous and professional, and consistently deliver great customer service. I have always been amazed by this — it is a very high-traffic store — yet the folks working there rarely get overwhelmed.

Everything was going well until I learned that my expected “new every two”, the program that provides a $50 credit toward the purchase of a new phone, wasn’t available to me. You see, I was on someone else’s family share plan for the previous 18 months and, by Verizon policy, wasn’t eligible for the credit because I wasn’t the primary account holder. I was pretty upset — I had been a customer for years, and a profitable one at that (I’ve had a smartphone since 2004). How could they not acknowledge that I was a long-time customer? Was it worth the $50 to them to make me feel like my business wasn’t valued?

I grumbled to the person who was setting up the phone. She responded, “I hate telling someone no, especially if they’re nice, but there really isn’t anything I can do.” I accepted it and moved on, but remained irritated by the policy.

I received a robocall later that week asking for my opinions about the service I received. The first part was a standard survey, but at the end, it allowed me to leave a voice mail with additional comments. I took the opportunity to emphasize how much I appreciate the service at the store (even if I’m just browsing), but mentioned that I was disappointed by the new every two policy. I hung up the phone and promptly forgot about the call.

A couple of days later, I got a call back from the manager, who had said he received my message and wanted to follow-up regarding my complaint about their policy. I was stunned — I never expected my message to be heard let alone reacted to. I mentioned how great the staff was (again), but laid out my case for why the new every two policy was not right. He immediately agreed, saying that he felt that it was a bit unfair since people often pool their plans to save money (and pay their fair share), yet aren’t given the benefit of the primary account holder. He then credited my account $50 and thanked me for my feedback, also stating that he would be sending the complaint about the new every two policy to his district manager.

For all the ads that tout Verizon’s superior network, I have to say that this interaction taught me that big corporations, especially those that are providing utility-level products or service, can deliver excellent customer service. It is possible for a company to hire well, train well, and empower the folks working on the front lines to satisfy the needs of their customers. Not only does it build goodwill with individual customers, but it creates the kind of word-of-mouth marketing that can make the difference in a competitive consumer landscape.

What Strategy Would You Use To Defeat Yourself?

September 14, 2009 / Albert Ciuksza / 0 Comments

What a question.

It appeared in this post from the informal, slang-filled, business site called Trizle (I recommend it — a great jolt of reading at 30 seconds a day). The question hit me between the eyes.

Does anyone ever ask this? I’ve not seen it very often. Sure, there are senior executive strategy sessions that generate a nice little printable SWOT analysis that gets thrown into a binder and put right next to last year’s strategy binder. But, do these sessions really get to the core of what’s going on and, if they do, do they lead to the actions necessary to make it all better? I’ve always hated the statement “knowing is half the battle”, because I believe that, while knowing might be half the battle, you’re still dead if you don’t fight the other half.

Bad economy or great economy, we’re in global knock-out-drag-out fight for resources. If you don’t compete, you don’t win (or even get to stay on the field). That means that you don’t get the sale, you don’t get the donor, you don’t get the legislation passed. People lose jobs, companies close, mortgage payments get missed and it’s game over. The company/non-profit organization/public recreation center/corner doughnut shop dies, right along with the income and jobs. Them 1, you 0.

Discussing the issue is tough — the death of our job, the death of our organization — those are big scary things we just don’t like to think about. Senior managers don’t like the question either, so they bury their heads in operational issues while completely neglecting strategy. When the time comes to lay people off, close a plant, make people work more hours for less pay, outside factors are almost inevitably cited as the culprit. You’ll never hear a manager say, “I was asleep at the wheel, running away from my real job (understanding and fixing the real problems), waiting for everything to blow over. My bad.”

Be a better leader. Ask this question of yourself, your department, and your organization. Write down the answers. Take action to fix the problems. To do otherwise is not only to ignore your responsibility, it is putting other people’s lives at risk.

Can you ‘Six Sigma’ a New Product?

September 8, 2009 / Albert Ciuksza / 0 Comments

I was reminded of my short-lived exposure to Six Sigma this weekend when I came upon an article in the New York Times called Welcoming the New, Improving the Old. It touched upon a challenge that had concerned me when I was going through my green belt training (a level of Six Sigma certification) at the time.

Six Sigma is an incredibly rigorous process focused on statistical measurement in order to make improvements in the delivery of a product or service. I was originally drawn to it as a way to solve some of the process problems I had faced in my own area, expecting that it could be used to address nearly any challenge.

What I learned is that, as powerful a tool as Six Sigma can be, it is also easily manipulated to measure the wrong things to solve the wrong problems. There were countless examples of companies applying Six Sigma to problems customers didn’t care about, which, in the end, wasted gobs of time and money. The point that our instructor hammered home was, “define what is a defect based upon what is important to customers.” This, frustratingly, is often not something easily quantified. Why? For two reasons: sometimes the customer isn’t very forthcoming about what they want; and sometimes the customer just doesn’t know until they see it.

For these very qualitative challenges, enter Design Thinking, defined as a process for practical, creative resolution of problems or issues that looks for an improved future result. The goal (improvement) is the same, but attacks the challenge from a very different perspective. I see Design Thinking as the methodology that creates the “aha!” moment that converts the prospect into a customer.

My favorite quote from the article: Continue reading

Start-ups Need to Tell a Story

September 4, 2009 / Albert Ciuksza / 0 Comments

A few months ago, Paul Furiga, CEO of WordWrite Communications, launched a new web site for his Pittsburgh-based Public Relations firm. His message was very simple — “What’s your story? We’d like to tell it”. I fell in love with the idea, and not just because I’m known for my long-winded storytelling.

Storytelling is, at the most fundamental level, the way we humans have communicated for as long as we’ve been able to speak. It is absolutely critical to our ability to exchange information, establish social norms, build rapport and make an impression. As social creatures with limited time and attention, a story can easily summarize information in an understandable, digestible way.

This particularly hit home with me when attending the recent Three Rivers Venture Fair Boot Camp, a tune-up of sorts for entrepreneurs that will be making nine-minute pitches to venture capitalists and angel investors. I was fortunate to be able to watch four different presenters go through their slide decks, and, as a panelist, help to provide feedback. Each company targeted completely different markets (i.e. social media, security, manufacturing and space exploration) but presented in very different ways.

The first three presenters were able to articulate, more or less, the value proposition of their product or service. They could describe features and functionality, identify their key team members, explain their marketing and sales plan and demonstrate the depth of knowledge needed to lead a start-up company. However, while each company had an interesting product, the presenters had challenges being able to spark the “aha!” moment that investors need to take the next step.

I found myself suggesting adding a story to each presentation. I kept saying, “if you can put someone in the shoes of a purchaser, they will more easily see the value proposition of the product.” My fellow panelists seemed to agree.

The final presenter nailed it. He as able to articulate in about 45 seconds how his security product would be used in the marketplace. He very quickly was able to speak to the challenges faced in this market niche and how his product would make people safer. It was storytelling at its finest.

When pulling together a presentation to potential investors, educate them by telling a story of the average user. Put a human face on the product or service you offer and use that story to demonstrate that there’s a large enough market for you to earn the type of returns necessary for an investor to be interested. While a particular technology might be interesting, cutting-edge, innovative or game-changing, it won’t matter if you can’t make someone feel the pain that will compel a prospect to become a customer.

In the Beginning…

September 3, 2009 / Albert Ciuksza / 0 Comments

I’d like to take this opportunity to introduce myself and, perhaps more importantly, why I’ve decided to take up blogging.

My name is Albert, I’m 28 years old, and I’ve been an entrepreneur for nearly 20 years. I know it sounds ridiculous, and I don’t blame anyone for their skepticism. But, when it comes down to it, I’ve wanted to do sales and marketing my whole life.

A story … my first solo venture was artistic – I painted t-shirts and sweatshirts with craft store t-shirt paint and sold them to various friends. I can’t say that I was particularly successful — I might have only had a dozen or so takers — but it’s amazing what you can learn about your target market, customer service and the need to be responsive to others’ needs. Most importantly, you have to be extra good when selling to elementary school friends; they never hesitate to tell you when your product sucks.

In any case, this fundamental love for sales, marketing and getting products into the hands of people who will truly enjoy them has been the underlying driver of what I do. Sometimes it is a business or strategic plan, sometimes it is market research, sometimes it is a logo or web site and sometimes it is even a very polite “no”. Regardless of the situation, it is knowing that whatever I am doing is working that gives me the greatest satisfaction.

So, why should you read my blog?
Continue reading