Author: Chris Cameron

Since we published our Never Mind the Valley article on the growing startup scene in Chicago, I have received several emails about various events and startups that call the city home. The technology culture in Chicago is quickly expanding, just as it is in most major metropolitan areas, because startups as a culture are breaking further and further into the mainstream. As we’ve shown with our series of profiles, no longer is Silicon Valley the one true home to startups; Boulder, Austin, New York, Portland and many others have stepped up as worthy contenders for national (and international) startup attention.

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With the expansion of startup culture across the U.S. and the world, more organizations and events once exclusive to the Valley are providing resources and opportunities to a new breed of startup hubs. Taking place later this week is one such event, the midVentures25, a demo event for Chicago-area tech startups modeled after the TechCrunch50.

“Instead of becoming the ‘second San Francisco’, we at midVentures are more interested in connecting technology innovators to thought leaders in art, media, real estate, education, law, business, science, and politics,” writes midVentures co-founder Geoff Domoracki. “We encourage entrepreneurs to meet with thought leaders in diverse disciplines — to realize the full potential of their innovations.”

midVentures is a Chicago-based Web 2.0 venture consulting agency that helps startups through the process of planning, prototyping, launching and growing their ideas. The event, which takes place this Thursday, will feature 25 hand picked startups with demos in an open expo-like show. After a few hours of floor demonstrations, judges will select the five best demos to present on stage and answer questions from the panel.

The panel of judges includes Groupon CEO Andrew Mason, OCA Ventures‘ Jason Heltzer, and Google‘s Head of Technology, Kevin Willer. From the five finalists, the judges will select one winner to receive $10,000 worth of products and services, including consulting, advertising and a years worth of hosting and bandwidth.

“The focus of midVentures25 is to show the national technology and investment community that the Midwest has an abundance of early-stage innovators within the technology, consumer, and sustainability space,” says contest founder Jonathan Pasky.

It is great to see startup culture expanding across the U.S., and events like these mark the shifting weight of focus from Silicon Valley to other cities. Some have argued lately that startups and entrepreneurs outside of the Valley are complaining too much about a lack of resources or funding for their city. While it’s true some cities are less cash rich for startups, complaining about it doesn’t do anything; starting events like these is how you begin to fix the problem.

There is a cultural divide between Silicon Valley and other startup hubs; those in the Valley aren’t as afraid to risk investment dollars on unproven startups, while other cities just simply aren’t as accustomed to this sentiment. Unfortunately, one of the only ways newer startup cultures are going to embrace funding more companies is through time. As the city grows more accepting of startup culture and future generations of investors and entrepreneurs take over, things will begin to level out.

Photo by Flickr user moron958.

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In December of last year, augmented reality (AR) browser makers Layar chose to pull its iPhone app from the App Store due to frequent crashes reported by users. They thought it was better for their brand to remove the application than to promote a faulty product. As we’ve mentioned in the past, Layar had hinted that a revamped iPhone app would be out near the end of February, and earlier this week they released just that.

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With the relaunch of their iPhone app, Layar rejoins acrossair, Wikitude and others now vying for elbow room in the mobile AR space. Layar boasts one of the largest collections of points-of-interest (POI) data sets and now that library is available again on the iPhone. The usual suspects can be found on Layar, such as Flickr photos, Google search, YouTube videos and Wikipedia articles, but one of the more unique layers on the app is Foursquare integration.

Users can use the Layar AR viewfinder to find nearby Foursquare locations and by linking the app to their account can check in without leaving Layar. There is also a feature in each layer to view entries on a map, or in list view. The map is especially handy for Foursquare integration because Foursquare’s own app disappointingly doesn’t support a map view. An equally interesting layer to investigate is the Recovery.org layer which shows you which U.S. organizations in your area received funding (and the amount they received) from the Recovery Act.

“The new Layar Reality Browser has a re-engineered engine under the hood. This new engine makes the application light, stable and very quick,” the company said on its blog. “It is ready to handle all the current layers and it is a good base to realize all of our exciting future plans.”

Layar’s return to the iPhone platform comes just in time for the company’s new layer marketplace which will allow developers to charge users for their content; in other words, an App Store for mobile AR. If Subway wants to create a layer with all of their locations and charge $.99 for it’s use, they or any other company will easily be able to do that. One could assume that Layar will make use of Apple’s in-app purchase functionality on the iPhone, but it would be sad to see Layar lose a percentage of their cut on the purchases to Apple. If anything, that could raise prices on the layers themselves, but that’s a whole other argument.

This could be a huge step forward for the mobile AR space. As these applications become more useful, more refined and more popular, companies will be excited to participate in providing branded content in an AR experience. Expect an announcement from Layar in the next few weeks about the launch of this exciting new platform, but in the meantime, iPhone users (3GS only) can go snag Layar’s free app (iTunes link) in the App Store.

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For entrepreneurs trying to form a startup, one of the first challenges they face that persists throughout the businesses life is how to find and keep talented partners and employees. From finding that first co-founder to finding the prolific programmers to fill your ranks later down the line, talent acquisition is always a major step in any business. Just look at some of the deals that have gone down in the Valley; Facebook didn’t buy FriendFeed for their technology, that deal was mostly about getting FriendFeed’s talented employees on the Facebook team.

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A new book from author David Russo, 17 Rules Successful Companies Use to Attract and Keep Top Talent: Why Engaged Employees Are Your Greatest Sustainable Advantage, seeks to make this process more clear for businesses. Russo is the CEO of Eno River Associates, Inc., which is a consulting service that helps business executives build better team relationships. Their portfolio of clients includes American Express, Johnson & Johnson, and the CIA. With his new book, Russo outlines the key strategies he has learned over the years as a consultant and human resources executive that has helped him and others create winning teams.

The book doesn’t waste any time getting into its 17 rules; after a brief introduction the entirety of the book consists of one chapter per rule. The rules cover a broad base of topics, including the more straightforward rule #4, “Provide Ample and Appropriate Resources,” to the more abstract rule #12, “Understand Human Capital.” One of the key rules that sticks out to me is #3, “Cultivate Leadership, Not Management, and Know the Difference!”

“Whereas managers administrate, leaders have the power to influence, to motivate, even inspire, and those are distinctly different traits,” writes Russo. “Indeed, true leadership is the ability to display attributes that make people want to follow.”

Russo points out that leaders need to have passion, vision, and energy, as well as recognize that each employee has value to the success of the business. He likens this value to a tight end in a football game running “a crisp pattern” and distracting the defense despite knowing before the play that he’s not going to be the ball carrier.

Another rule which will likely strike a chord with the startup culture is #10, “Make Room for Fun in the Workplace (Nurture Lightheatedness/Levity).” Anyone who has seen the popular workplace movie “Office Space” knows what a bland work environment can do to employees spirits, but I don’t think we have to worry about startups not having enough fun on the job.

Aside from being passionate about the job they’re doing, most startup employees are probably used to everyday being “casual Friday” and taking a brain break in a game room. Granted, not every experience is like this, but we all know that many startups are a very relaxed environment, which Russo says is very important for attracting skilled employees and keeping them happy.

Other important rules Russo includes on his list include knowing how and when to “cheerlead,” acknowledging and rewarding efforts and contributions, and the lastly, telling the truth. While this book isn’t aimed directly at startups, young entrepreneurs looking to lead their team to success should certainly take a look at this book.

One of reasons I would suggest it is that at times, young entrepreneurs who have little or no workplace experience are suddenly thrust into a CEO role. If your company takes off, you might be in charge of a lot of people very quickly, and this book will certainly help keep them happy.

Disclosure: A review copy of 17 Rules was provided to ReadWriteWeb by Pearson Education, Inc.

Photo by Flickr user madebytess.

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last few months, we’ve focused from time to time on design and how it affects startups. One of the larger issues that comes up that goes hand-in-hand with design is the copywriting that accompanies that design. The importance of carefully crafted wording can not be understated; after all, the words are what actually speaks to your audience when they visit your site. Copywriting is as much an art and a skill as design is, and that’s why the crowdsourced design network crowdSPRING is now including copywriting jobs for bids on their site.

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As of Wednesday, the popular service opened up their designer’s club to include copywriters. Now clients looking to crowdsource text for any use can log onto crowdSPRING, set up a contest for users to submit their work to, set a reward price, and watch the entries roll in. The writing jobs can be as short as a name for company or text for a website, or as long as an essay, script or book. Various types of writing jobs are grouped into five categories: business, creative, editing, naming and online.

So far only ten jobs have been submitted, but the site’s network has already feverishly kicked into gear, submitting nearly 1500 entries in just over a day. The current projects range in reward payout from $200 to $1500, the latter being a private project asking for a presentation.

Another of these first ten projects posted comes from the City of Chicago which is hosting an elevator pitch contest on the site. Chicago-based Small businesses can submit a written version of their 30 second pitch for a chance to win $500 and a free booth at the upcoming Small Business Expo in July.

“By using crowdSPRING for our annual competition, we’re hoping to get some amazing elevator pitches,” said Chicago City Treasurer Stephanie Neely. “We’re optimistic we’ll find the talent we need and build buzz around our competition, and hope the innovative submission process will help drive participation and attendance around our business plan competition.”

Earlier this week, we discussed whether crowdsourcing and outsourcing were wise business practices for startups. Some argued that early stage startups may be too fragile to rely too heavily on these practices, but most agreed that if used correctly, crowdsourcing and outsourcing could be valuable tools to startups. In this light, startups can certainly benefit from these new services provided by crowdSPRING.

Startups without the sufficient staff to cover media and public relations can use the service to produce emails, newsletters, blogs and other materials they may not be able to create effectively on their own. First time entrepreneurs who’ve never written a business plan can now use the site to crowdsource a solution instead of toiling over it themselves, provided they give the applicants sufficient information regarding the company. At the very least, an entry like this could be modified or used as a starting point for a more involved plan.

However, a startup may be reluctant to crowdsource business materials for fear of revealing private business information to the site’s users. What if a user sees a job for a business plan detailing a startups roadmap for success and decides to steal the idea? According to crowdSPRING, they have been forced to ban users for violating the site’s IP rules in the past.

“We work together with our entire community… to identify possible violations of intellectual property,” the site says. “We expect that people in our community will share the community’s core values, which includes the protection of and respect for intellectual property.”

It seems that IP security is not something crowdSPRING takes lightly, as this blog post makes very clear. For any business, theft of intellectual property is an inherent risk with oursourcing and crowdsouring, but it would seem that the service is going to great lengths to ensure their users are safe.

Photo by Flickr user Unhindered by Talent.

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Here at ReadWriteStart, we’ve been following the Open Angel Forum closely as Jason Calacanis’ project moves from city to city bringing angel investors and worthy startups together in one room. The first event in Los Angeles was of particular success to Backupify, which provides backup for your online social network data, including Facebook, Twitter, Delicious, WordPress, Gmail, Basecamp and many other services. Following the event, the company raised a Series A round of $900,000 from Calacanis, Chris Sacca, First Round Capital and a few others.

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Earlier this week, CEO Rob May posted his take on the process of raising funding from VCs, which he likens to dating. According to May, pitching to VCs is not about forcing your idea down their throat and convincing them why they should invest in it; if a startup and a VC are meant to be, it will be more like love at first sight.

“They either like you and your idea, or they don’t. It’s like dating because your goal in dating is not to convince someone who is a bad match for you that somehow you are really a good match. That’s a recipe for divorce,” says May. “It’s really about finding the person that is naturally a good match. Same way with investors.”

One thing that May did much differently than other entrepreneurs seeking funding is that he approached investors without a business plan. While he doesn’t recommend this as a solution for every startup, he does find that in his case, not having a business plan did not really hinder his efforts.

“I sat in front of VCs who thought I was crazy for not having a business plan. I was asked ‘how can you run your business if you don’t have a written plan?’,” says May. “I also sat in front of VCs who said ‘glad you didn’t waste time writing a plan, because we wouldn’t read it anyway.’ It’s really more of an art, not a science.”

Another less standard practice May chose to include in his presentation at the Open Angel Forum was not a special slide on his pitch deck or a certain phrase; May drank a beer while presenting. Again, he doesn’t suggest this is a solution for everyone, but he uses it as an example of how to relax and “be yourself” when pitching to VCs. They are very experienced at talking to startups and any good VC knows how to spot when you are full of hot air, and they will call you on it.

“It’s never easy, not even when you have a good idea. That’s the point. That’s why so few people ever do it,” says May. “If you want to learn to raise money, the best thing to do is go try to raise money.”

Photo by Flickr user apol3.

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One the interesting differences for startups on the east coast compared to the west coast is how much more compact the east coast is. For Silicon Valley, the nearest major metro cities are 400 to 800 miles away, which makes the San Francisco area much more secluded. Boston, New York, Washington D.C. and Baltimore are all within a short drive of each other, which makes the sharing of resources, talent pools and events much easier that on the west coast. Philadelphia, conveniently located between Washington D.C. and New York, is home to DreamIt Ventures, which is now accepting applications for its 2010 summer accelerator class.

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Until March 22, entrepreneurs with an idea and a team can apply to receive up to $30,000 in capital as well as office space, mentoring from successful entrepreneurs and exposure to investors. The accepted groups will benefit from both the guidance of DreamIt’s newest partner, Kerry Rupp, formerly of Classmates.com, Jobster, and LexisNexis, as well as the firm’s partnership with StartL, a startup accelerator focused on education services.

“Our first two classes of DreamIt companies were exceptional,” said DreamIt founding partner Mike Levinson. “We expect this year to be our best class yet. We will have more applicants than ever before, impressive new mentors and a more vibrant community of investors keeping an eye on our companies.”

DreamIt’s accelerator has produced a handful of success stories in the past, including NoteHall which was featured on ABC’s prime-time television show Shark Tank where they were awarded funding. Additionally, SeatGeek, an online ticket pricing service, went on to secure over $500,000 in funding, and location-based gaming company SCVNGR has received $4 million in funding from Google Ventures and currently serves over 400 clients. According to SCVNGR CEO Seth Priebatsch, the company “would be nowhere near where it is now without DreamIt’s help.”

The three month program seems like an excellent incubator option for any east coast startup looking to secure some early funding while collaborating with fellow entrepreneurs. DreamIt also accepts applications from individual programmers and strategists looking to be paired up with a team, so the program can also help startups fill their ranks.

Photo by Flickr user enfi.

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Chances are, if you’ve called customer service to enough companies, you’ve come across a representative who works for a call-center which has been contracted to handle a comapany’s account. Large corporations that don’t want to employ their own agents and maintain their own facilities will often outsource customer service to a third party, which at times can mean a company in another part of the world. Bangalore, India was famously portrayed for its role in call-center outsourcing in the Thomas Friedman book The World Is Flat, servicing many large American companies. But tools like outsourcing or crowdsourcing are not always beneficial to every breed of company.

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A recent post on crowdsourcing from the startup blog Plugged.in, and a Forbes article about outsourcing have both warned startups of the possible complications of both. Crowdsourcing is similar to outsourcing in that a task normally conducted by an employee is shifted to a third party, but in this case the job is performed by numerous people, not just one. If I wanted to outsource the web design of my new site, I might hire a graphic designer, but if I wanted to crowdsource, I could use a service like crowdSPRING to host a competition and pick from a whole slew of designs and designers.

While crowdsourcing and outsourcing are fundamentally different, they share similar risks, especially for startups and small businesses. As the Plugged.in article suggests, more mature companies might be better candidates for this type of work.

“Startups do not fit the ‘business case’ that could garner qualified social feedback for its product from the crowd,” the article argues. “The product engagement within the market has not been long enough, and more often than not the sample size of [the] crowd may not be representative at all.”

The idea here is that crowdsourcing works better when the audience participating is more aware of the product in the market. With startups, crowds may not have the most accurate sense of the best direction for an idea, especially one that is new and innovative. That’s what you, the entrepreneur, are for. The article warns startups to not rely too heavily on information gathered from the crowd in terms of which features to keep, which to throw away, which to add, or any other kind of information. Startups should always listen to their users, but work with them, not for them.

Along the lines of do-it-yourself, the Forbes article chronicles an unfortunate tale of outsourcing gone wrong. In my interview this week with Danny Wong of Blank Label, he pointed me to this article based on an interview with his co-founder, Fan Bi. In it, Bi warns startups looking to outsource design and development to cheaper labor pools should think twice before doing so.

“It was too good of an opportunity to pass up when we were trying to bootstrap our business. Getting the work done for a quarter of the price was tempting,” says Bi. “The team abroad wanted quick and dirty projects that can be turned around quickly and get them paid. They had no real ownership.”

The outsourced work came back looking “terrible”, he says. The designers and coders they had outsourced had no passion or personal investment in the work they were doing, and it showed in the quality. For startups, it seems that finding a partner or employee who is just as passionate about the company and its vision is well worth the extra money for the quality they bring with them.

Entrepreneurs are highly motivated and driven people, and companies succeed when a group of passionate people set their sights on one goal. Outsourcing and crowdsourcing seem to go against that mantra, and one could argue that these are lazy roads to go down for a startup. But are crowdsourcing and outsourcing a pair of techniques that should be avoided outright by startups? Or are there times when a startup can employ one of these tactics? Let us know how you feel about this issue in the comments.

Photo by Flickr user Vilma.com.

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I had the opportunity to talk Monday with Danny Wong, one of the co-founders of the startup Blank Label which allows customers to create custom men’s dress shirts. Users can pick fabrics, collar styles, cuff styles, size and fit options, as well as embroider custom monograms.

The company is the brainchild of Wong’s partner, Fan Bi, who developed the idea during an exchange program between the Boston area’s Babson College (a school we’ve mentioned before for it’s entrepreneurship programs) and his school in his home of Australia.

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Bi and Wong initially hired locally, bringing a Boston-based graphic designer on board, but eventually they were forced to look beyond the east coast for a programmer. After hiring their lead developer in Orange County, California, Bi’s exchange program ended, forcing him back to Australia, and splitting the Blank Label team across three distant locations, but the fledgling company has still managed to grow. Bi now lives in Shanghai where he can run the company’s supply chain with their manufacturer, while the rest of the team works virtually in California and Massachusetts.

Wong and Blank Label are an excellent example for startups in smaller communities that need to hire employees outside of their location. Here are some excerpts from my interview with Wong on the pros and cons of working with a split team in a startup as well as some insights into how they’ve managed to get off the ground and continue to grow.

What lead Blank Label to become a split team?

We couldn’t find someone local. We dug really deep, we tried to leverage our secondary network. All three of us were in the Boston, Massachusetts area at the time, and we were trying to find this fourth partner who could do programming and who could make something really amazing for us without us having to outsource. We’ve had a tremendous amount of terrible stories with outsourcing, we even had an article written about us on Forbes.com about how we decided to bring someone onboard as opposed to outsourcing because we had so many issues with outsourcing. But the fact of the matter was, on the east coast, we couldn’t find anyone that was good. Theres definitely an abundance of software talent on the west coast and getting an awesome, passionate technical co-founder even at a distance who believed in the vision, who had thought about the idea space a few years previous was a bigger advantage than the disadvantage of not having him local.

So you were looking for someone who could program but also had the entrepreneurial mindset?

Yes.

And that was hard to find on the east coast? Because I’m sure there’s plenty of programmers coming out of the colleges out in Boston.

Some of them have the entrepreneurial spirit as well, but part of the problem was that a lot of them didn’t believe in us because we were an unproven concept. We had an idea, and our team didn’t have the best credentials, but we had an idea and we were incredibly motivated. Naturally, people will be skeptical.

That’s interesting because that’s kind of how ventural capital goes too, east coast to west coast. You won’t get as much funding on the east coast for something that’s not as proven a model as you would in Silicon Valley where they’re more likely to invest in something more risky.

Yeah, well there’s also a cultural difference. We’re more conservative on the east coast, just as a culture. On the west coast they’re incredibly liberal, they’re not averse to risk taking. They’re not averse to change. That’s why you see all of these disruptive startups coming out of the west coast. There are some people pushing it on the east coast, but certainly not as many in proportion or in volume compared to the west coast.

So you eventually found your fourth partner?

So we found a co-founder, we found him through the web…We’ve just had an interesting relationship since. A few more details about the team dynamic: we’ve never met Zeeshan.

And he’s the programmer from California?

Yeah he’s out there. Alec, our graphic designer, and I are now in Boston… Towards the end of 2009 Fan was finishing his exchange program at Babson, I attend Bentley, Alec graduated in June from Roger Williams. Alec and I barely see each other, but we go out now and then on the weekends. Fan’s visa soon expired because he finished his exchange program at Babson in December… Immediately after new years he flew out to Australia, spent some time with his family, and now he’s moved to Shanghai for the business…We decided to move Fan out there because it was the best solution for the company. Now he’s working with our supplier directly, and we have a new supplier, we have better quality control, we can source more fabrics, we have transparency with the supplier, we know more about our raw costs, the time it takes to produce a product, and then we’ve figured out better shipping options to get the product to the consumer faster.

So how do you collaborate over such long distances?

We use web-based document sharing, we use Dropbox and Google Docs. We use video conferencing, we use ooVoo instead of Skype because ooVoo allows us to do multiple-person video conferencing. We also use a couple project management tools, Acunote specifically to set goals and sprints for our web-based projects.

What’s it like to set up a manufacturing partnership with a company in China? That’s got to be a daunting thing to look at.

Yeah. When Fan was living in Australia he used to go over to Shanghai every summer because that’s where his [extended] family was. He would get his products custom made and that’s how he came up with this idea…He decided to go snooping around and he found a manufacturer and they had direct contact at the beginning…He set up the supply chain. We were working through an agency which put us through to a manufacturer so that was a little sloppy. The manufacturer itself was talking directly with us so we couldn’t tell them exactly what we wanted. There were too many steps in the process because we would talk to the agency who would talk to the manufacturer, and the agency was pretty much a middle man, and the problem there was our costs were higher, and sometimes the message gets mixed up. It was complicated, it definitely was, and there was also a time delay because we have to talk to the middle-man and the middle-man has to find time to talk to the manufacturers.

Not to mention the time-zone differences.

Yeah… Our original manufacturer, their main business was suits, and they just happened to do shirts too, and we pushed them to do things a little different, and they said “Oh, what are you doing? No one ever does this?…You’re putting to much pressure on us, you’re asking for a quick turn-around, we don’t have time for this…For us to make one of your shirts, we could have made 4 other shirts that were mass produced.” So our interests weren’t really aligned, and they’re expertise weren’t there. Our tailors now work specifically with creating dress shirts every day, so we just told them to do things a little different and they’ve done very well.

Monday evening I was made aware of a particularly interesting promotion that will be taking place over the course of two days before South by Southwest (SXSW). The event, or tour, is called The Startup Bus, and will challenge 12 participants to create as many tech

startups as possible during a 48 hour bus ride from San Francisco to SXSW in Austin. The question this event raises in my head is whether these “beat-the-clock” entrepreneurship experiments are actually healthy for the broader startup culture.

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This event isn’t the first of its kind; in fact, it closely resembles the Startup Weekend event series, just on wheels and with fewer people. We also reported back in January on an Australian man who was attempting to create and launch a startup in a week with just $500. Going solo is a little different than collaborating with a large group of entrepreneurs with the guidance of experienced mentors, which has helped Startup Weekend produce several success stories from their events. It’s unclear whether The Startup Bus will host a similar makeup of entrepreneurs and mentors, but what is clear is that they will face many challenges on the road to Austin.

The participants will be crammed into a crowded bus for two days – not an ideal environment for constructive thought, at least not after the first day or so. A few years ago I took a two day bus ride of similar length from Madison, Wisconsin to my home in Phoenix, Arizona. I can attest that being on a bus (even a nice bus) for that long is not the most pleasant experience. I could have flown home, but I thought that a two-day bus ride with friends would be fun, and it was, but it was also exhausting. Sleeping, at least for me, was near impossible, and the claustrophobic nature of being packed elbow-to-elbow with 40-60 people (people I would even consider close friends) does not leave your brain in a great state, let alone foster the kind of critical thinking required by great entrepreneurs.

Last week The Startup Bus announced some changes to their original plans, allowing for 40 spots on the bus, which could just be for mentors, investors and journalists on top of the 12 main participants. By more than doubling the number of people riding the bus, its uncertain if they will still be able to secure a motor coach with beds, something they had originally planned. Regardless of the amenities, however, sleeping on a bus doesn’t come easy, beds or no beds.

Issues have risen from collaboration events in the past surrounding intellectual property; when a group of people come together on an idea, who’s to say who owns it? The Startup Bus is tackling this problem by having participants auction off ideas to the highest bidder at the end of the trip, an interesting solution to IP disputes.

But enough about The Startup Bus, this article really isn’t about them. This isn’t meant to be critical of their experiment, or of the man in Australia, or any other startup “challenge” for that matter. In fact, The Startup Bus actually seems like a interesting experiment in entrepreneurship that could leave the participants with lessons they will carry with them into their futures. Additionally, these groups are providing a unique experience that can actually foster good ideas through collaboration of entrepreneurs, programmers and business people.

The real question here is do these kinds of experiments ultimately benefit the overall startup community? Or do they give a false impression about the time, dedication and persistence that are required to start a successful company? Are people outside of the startup culture receiving the wrong impression about the seriousness and validity of startups? Granted, the conclusion of events like these marks only the beginning for a possible company or product, but does the haste in which these groups and ideas are thrown together speak to their overall quality? Eric Woodward of Nambu made his opinion on this matter clear Monday night in his Twitter status below.

Is Woodward right to be critical of The Startup Bus? Or is he missing the broader point? I would argue that events like these do have a benefit, especially to those directly involved. The mentorship received by the participants at Startup Weekend is certainly enough to make it worthwhile, not to mention the potential created by having a large group of smart people all in one room. When smart people get together, good things happen. The Startup Bus could certainly replicate this experience, but the challenges of being on a bus will undoubtedly make things tricky.

However, one could also argue that these benefits come at a price by creating a false sense of what starting a company requires, though I doubt any of these events or organizations are actually trying to belittle these ideals. I’ll be interested to see what kinds of ideas manage to be built and launched by the Startup Bus participants when the group arrives at SXSW in a few weeks. This issue is bound to draw strong opinions on both sides, and that’s not a bad thing. Please let us know how you feel about this issue in the comments below.

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Anthony Tjan is a venture capitalist at the Boston-based VC firm Cue Ball, but he also blogs for The Harvard Business Review where last week he posted an article about packaged pricing deals in business. The article, The Pros and Cons of Bundled Pricing, points out the differences between bundles and “à la carte” pricing as well as benefits to both customers and businesses. Most Web startups offering an array of services will often bundle features into tiered pricing plans rather than an “à la carte” selection, and here’s why.

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Using bundled pricing over “à la carte” pricing isn’t just a simple decision of choosing the method that makes more money; bundled pricing can benefit businesses (and their customers) in other ways. While bundled pricing doesn’t always necessarily benefit the customer, it can provide them with a better overall experience with the service being sold.

Tjan’s example is a 5-star hotel that charges $750 per night, but the bottle of water in the room is an extra $10. To most people, $10 is a lot for a bottle of water and they will make sure they don’t crack it open lest they see that extra $10 on their bill. If the hotel chose to instead bundle the cost of the water into the room and charge $760 per night, they could advertise bottled water as a feature. In most cases, someone willing to pay $750 for a hotel room is also willing to pay $760, but they don’t know that they’re being charged $10 for the water, it’s just a hidden cost rolled into the bundle. They get to their room and think, “Wow! Free bottled water!”

The hotel in this example is banking on the percent of people who won’t drink the water that they unknowingly paid for in the bundle. As Tjan points out, the same can be said for Web startups and software services.

“Think also of the fact that while most users of software use only a fraction of the available functionality, it is the basic users who are subsidizing the long-tail product development of features used by a relatively small number of advanced users,” writes Tjan.

Bundled pricing can be a good and bad thing for both customers and businesses. In the case of the hotel, customers are paying a higher price which is an obvious benefit to the hotel, but in the end, the customers are also enjoying a better experience with the perceived “free” water. The opposite is true in Tjan’s alternate example of fast-food restaurant value meals. In this case, the customer benefits from a lower price by bundling a burger with fries and a drink, but the restaurant can also benefit from a more streamlined workflow in preparing the meal.

For customers, there are times when seeing a breakdown of a bundle’s pricing is advantageous, but most businesses are cautious about revealing such information. As Tjan points out, the key for businesses in this case is finding the right blend of these two ideas.

“The answer is simple: you should not confuse transparency with a pricing strategy. If you are the seller, focus on the total value provided which is fair for the customer and you,” writes Tjan. “Show the list of all activities performed for a service without individually valuing them. Providing individual price breakdown can kill any perceived or real synergistic total value.”

Obviously there are exceptions to any rule, and not every bundled pricing situation offers a mutual benefit to both parties. But are there situations when “à la carte” pricing could be beneficial to both customers and businesses? Let us know your thoughts on pricing in the comments.

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A visit to the typical homepage for a venture capital firm most likely provides a well designed landing page that spells out the firm’s mission with links to its portfolio companies and VC bios. Secondary to this general information is a page dedicated to press releases from the firm, or in many cases, a company blog with relevant posts. First Round Capital, however, recently redesigned its homepage to place a much heavier emphasis on real-time information from news sources and its VCs, and portfolio companies.

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The feed works in a similar fashion to Facebook’s news feed in that information is presented in a reverse chronological order. It includes news from its portfolio companies, third party news articles, as well as blogs, tweets and even Foursquare checkins from its team of VCs and entrepreneurs – all of which can be subscribed to using RSS. Also included in the feed and on its own dedicated section of the site are job postings from First Round’s portfolio.

“One of the most helpful things a VC can do for a portfolio company is to help them find key hires,” writes First Round Managing Director Josh Kopelman. “And the jobs section of our site contains well over 125 current job openings within our portfolio.”

The job postings complement First Round’s Key Hire Wire, a weekly newsletter released a few weeks ago containing job openings with its companies. First Round also helps its portfolio out by placing these openings on a Twitter account dedicated to blasting these openings out to the Twittersphere.

The revamped site also contains a new portfolio section with some interesting ways to navigate through the firms numerous companies. A standard list of current and former companies is supplemented by options for viewing a tag cloud of industries and other keywords, a map of company locations, or a feed of company tweets.

First Round, which recently snagged the top position (by a wide margin) on Larry Cheng’s list of the top VC firm websites based on average monthly traffic, is leading the way for VC firms with its innovative approach to its homepage. What better way to show potential companies that you not only invest in innovation but that you participate in it yourselves?

And venture firms aren’t the only group that can learn from First Round’s redesign. A news feed of aggregated content from various networks can be a unique approach to the homepage of any company. In startup culture, most entrepreneurs and employees have their own blogs, Twitter accounts, Foursquare accounts, as well as of a number of other social network accounts. Rather than linking out to individual employees and making visitors click out to a slew of different sites, why not provide a handy news feed of relevant information from your employees?

The new site is an excellent one-stop location for startups and entrepreneurs to find pertinent blogs and news, especially for those looking to Foursquare-stalk their favorite VC at the local coffee shop. First Round has created a definitive resource for anyone looking for information relative to the firm, its employees or its companies – a model any company could easily replicate. Let’s just knock-on-wood that Facebook doesn’t go waving its shiny new patent in anyone’s face too soon.

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Last year, the ARToolkit, a fundamental building block for creating augmented reality applications, was ported to Flash in the form of the FLARToolkit. This was a watershed moment for AR, as it became exponentially easier for Flash developers to create their own augmented reality experiences. Before then, AR had been a high-tech concept that experienced developers and companies had been experimenting with; by becoming more accessible to Flash developers, AR took off in popularity last year.

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Now, in 2010, the ARToolkit has once again been ported, this time to Microsoft’s Silverlight platform. German .Net developer Rene Schulte recently released the SLARToolkit which will allow augmented reality applications to run in Silverlight.

“SLARToolkit is a flexible Augmented Reality library for Silverlight with the aim to make real time Augmented Reality applications with Silverlight as easy and fast as possible,” says Schulte. “It can be used with Silverlight’s Webcam API or with any other CaptureSource or a WriteableBitmap.”

The SLARToolkit supports detection of multiple markers, both from simple black and white, and custom markers, and is based on the Matrix3DEx Silverlight library. The port to Silverlight is another important step for augmented reality, and could lead to the further expansion of AR both on the desktop and on mobile devices running Windows Mobile.

Earlier this month we saw Adobe Flash and AIR gain support on the Android Mobile OS, and Flash on the iPhone has been a recurring rumor since the device was first released. AR may not be the biggest mobile market, or a killer feature for mobile phones, but with the expansion of the ARToolkit to Silverlight, and the Flash support on Android, it has taken a big step toward wider exposure to more users.

SLARToolkit – Silverlight Augmented Reality 3D projection sample from Rene Schulte on Vimeo.

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Highly recognized Silicon Valley venture capitalist Guy Kawasaki is not only the author of the inspiringly titled blog How to Change the World, but he has also penned nine books on various business and marketing topics. After attending college at Stanford and receiving his MBA from UCLA, Kawasaki cut his business teeth at a jewelry manufacturer called Nova before eventually being bitten by the “computer bug.”

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After a brief stint at an educational software company, Kawasaki was hired by Apple where he was responsible for marketing the original Macintosh computer in 1984. After the success seen at Apple in the mid-80s, Kawasaki left and started his own software and database development companies, Fog City Software and ACIUS.

Following a short return to Apple in 1995 “to maintain and rejuvenate the Macintosh cult,” Kawasaki started Garage Technology Ventures, an early-stage seed fund, with Craig Johnson and Rich Karlgaard in 1997. Today, Kawaski is the Managing Director at Garage, and the co-founder of Alltop, which he describes as “an online magazine rack”.

Of Kawasaki’s nine books, perhaps the most lauded has been 2004’s The Art of the Start: The Time-Tested, Battle-Hardened Guide for Anyone Starting Anything, which is an essential read for any entrepreneur. Kawasaki fills the chapters of his startup handbook with GIST, or Great Ideas for Starting Things, as well as tips on marketing, branding, customer development, pitching, recruiting and any of a number of valuable lessons.

More recently, Kawasaki published Reality Check: The Irreverent Guide to Outsmarting, Outmanaging, and Outmarketing Your Competition, a book focused on a similar vein as 1996’s How to Drive Your Competition Crazy: Creating Disruption for Fun and Profit. The book’s description says its time for a reality check “if the two most popular words in your company are partner and strategic, and partner has become a verb, and strategic is used to describe decisions and activities that don’t make sense.”

Kawasaki has tuned his storied marketing history into a successful venture capital and writing career. These books and others, including Rules for Revolutionaries and The Macintosh Way, have provided excellent resources for entrepreneurs and startups, and are must-reads for anyone starting any kind of business.

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On Wednesday, BusinessWeek released their list of the top 25 angel investors in the tech industry, naming Hunch co-founder Chris Dixon ahead of veteran angels Ron Conway and Reid Hoffman. Conway and Hoffman are two of the most influential angels in tech, and have invested in some of the largest Internet companies known today, including Google, Facebook, Twitter and Digg. Dixon, a younger, less experienced investor than Conway and Hoffman, snagged the top spot due to both his diverse investment portfolio and the superior financial performance of his investments.

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The list was curated in partnership between BusinessWeek and the startup tracker YouNoodle, which took a three pronged approach to ranking the tech angels. First they analyzed the growth of the angels’ investments based on the amount invested, the number of employees, and the number of “companies operating at valuations greater than $100 million, and the sale of any companies for more than $50 million.”

Leadership was the next key factor which BusinessWeek and YouNoodle took into account. “The importance of each angel was measured by looking at the network of co-investments between angels, as well as at the ability to act as a bridge to other angel groups,” writes BusinessWeek’s Ira Sager. “From the perspective of an entrepreneur, the ability to attract other investors is critical.”

Lastly, they compared each angel’s portfolio for diversity, which helped push Chris Dixon above his fellow angels. Dixon, an early investor in Skype, and his Hunch co-founder Caterina Fake (ranked 20th overall) hold the top two spots in terms of portfolio diversity. Despite being ranked 11th in terms of influence, Dixon was crowned the king of the angels thanks in no small part to the range of industries he has invested in; however the overall success of his investments seems to have played the largest role.

The financial performance category seems to have been given the most weight by BusinessWeek and YouNoodle. The top seven angels also fall within the top eight best financial performers; Paul Graham (No. 11 overall) is the outlier here, ranking seventh in terms of financial performance. The category with the least weight seems to be portfolio diversity, as Conway and Hoffman achieved their high ranks despite placing 12th and 24th respectively in diversity. Their cause was undoubtedly helped by their 1st and 3rd place finishes in terms of influence.

In fourth place overall is Esther Dyson, an investor in Delicious and Meetup, and behind her is Peter Thiel, who helped Yelp and Zynga get off the ground. Rounding out the top 10 is Marc Andreessen, Jeff Bezos, Chris Sacca, Mike Maples and Andy Bechtolsheim. Y Combinator’s Paul Graham found the #11 spot, Digg’s Kevin Rose came in at #15, Naval Ravikant is #22, and Google’s own Eric Schmidt is #24.

What are your thoughts on BusinessWeek’s list? Do you think the measuring sticks they used to rank the angels are fair? Or would you use different metrics to determine the best of the best? Let us know what you think in the comments.

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Holding down the proverbial fort for the mid-west, Chicago, the Windy City, is the third largest city in the U.S. and the most populous city that doesn’t sit on an ocean coast. The city, which does, however, rest on the shore of Lake Michigan, is home to a unique culture of nearly 3 million people and countless numbers of Fortune 500 companies condensed into its 234 square miles of city. Though the city is often passed over for Silicon Valley and New York in terms of startup cultures, Chicago has a expanding repertoire of companies, entrepreneurs, investors and organizations helping put the city on the startup map.

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The site Freshwater Venture has begun to profile Chicago companies and people involved in the city’s startup scene, and thus far has created an extensive list. Among some of the most popular startups to come from Chicago include Basecamp developers 37Signals, travel booking site Orbitz, FeedBurner, Apartments.com, and more recently, the hyper-local news site EveryBlock.

Chicago startups suffer from the same difficulty that other cities without a rich startup culture do: a lack of venture capital. EveryBlock was funded by a grant from the Knight Foundation, Orbitz was funded by airlines looking to compete with Expedia, and 37Signals was originally funded by the founders themselves. Before being acquired by Google, FeedBurner raised funding from multiple venture capital firms, but only one of their funders, Draper Fisher Jurvetson Portage (which is actually just one of over a dozen arms of DFJ) was from the Chicago area.

Chicago does, however, have its own native venture capital firms, such as Origin Ventures, OCA Ventures and Illinois Ventures, but a majority of Chicago-based VC firm investments are aimed at companies in other cities. The growing problem in Chicago over the last several years has not been dissimilar to other fledgling startup communities; the talent and the ideas are there, but entrepreneurs are drawn to places like Silicon Valley, New York or Boulder where funding is more readily available for startups.

“Chicago is a great town, but there isn’t really a startup culture here. The majority of people that have done well have left Chicago and found more success elsewhere,” said Brenden Mulligan of ArtistData in an article on the Northwestern University blog Medill Reports. “We’ve lost some great entrepreneurs to other cities.”

But things are not entirely dire for Chicago; new incubators, venture firms and second and third generation entrepreneurs are helping the city grow its startup culture. It also doesn’t hurt that Chicago, the third largest city in the U.S., has not only a massive community of customers to provide services to, but also a thriving technology economy. Increased investments in high-tech and medical companies has pushed Chicago into the forefront of cities creating technology jobs.

Sam Yagan, CEO and founder of online dating site OkCupid, SparkNotes and eDonkey is the executive director of Excelerate, a new startup incubator taking root in Chicago. Early-stage companies can apply for the premier thirteen-week “bootcamp” experience this summer where they will receive as much as $20,000 in funding along with mentoring from a laundry list of over 40 participating entrepreneurs. Among these mentors is David Cohen of TechStars, Harper Reed of Threadless, Seth Stemberg of Meebo, and Kevin Willer, head of Google’s Chicago offices.

Excelerate’s VP Kelli Rhee is also the VP at Sandbox Industries, an incubator and venture fund that has been active in Chicago since 2003. Sandbox’s venture fund provides anywhere from $50,000 to $2 million in early-stage seed funding, and manages the BlueCross BlueShield Venture Fund which invests up to $10 million in health care tech startups.

Matt McCall, managing director at DFJ Portage, was recently interviewed by Fast Company for their piece Why You Should Start a Company in… Chicago, and gave his reasons why the city is a good place for startups. Among his reasons were the massive population of customers the large city provides, the government money provided for research at the Universities, and the connectivity of the mid-west alumni that have become successful in other locations. Finally he says that the “family trees” created by the various generations of entrepreneurs are helping build the city’s startup culture.

“You’ve got entrepreneurs that are fourth generation entrepreneurs. As a result, they played at the big leagues,” said McCall. “They’ve got a mafia of people that they can pull in to the companies… And as a result, when you start a company, you’ve got kind of these built-in talent pools that you can reach into that you didn’t have say in 2000.”

With the help of incubators, organizations and events like Excelerate, Sandbox Industries, Chicago Tech Scene, TechBuzz Chicago, Startup Weekend Chicago, TechNexus and TECH cocktail, the Windy City is on the rise as the startup playing field levels out. No city will ever match the atmosphere found in Silicon Valley, but Chicago’s unique ecosystem of their own has and will continue to produce noteworthy startups.

Photos by Flickr users David Paul Ohmer, Christopher & Amy Cate, and Mike.

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A few weeks ago we brought you a brief list of social networks for meeting and conversing with entrepreneurs, and in the comments section we received lots of suggestions that could have made the list as well. One such suggestion was Sprouter, which is, for lack of a better description and despite having a few unique features, a Twitter clone for entrepreneurs.

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Users can enter a 140-character status update and see both a public timeline and a list of updates from the users they follow, which can be filtered into groups. Users can also create “Events” and “Topics” around which to talk about by using hashtags – a nice feature that adds on what the Twitter culture has developed.

When I checked out Sprouter a few weeks ago, it was lacking a few obvious features, namely Twitter integration and the ability to find friends on other social networks. Just yesterday, however, both of these features made their debut on the service, making it exponentially more useful.

Sprouter’s 10,000-plus users can now link their accounts and send updates back and forth between the two services, either by choosing to push all of their updates out from Sprouter, or by using the #Sprouter hashtag in Twitter.

“Twitter has a huge audience, and we recognize that many Sprouter users also use the service,” says CEO Sarah Prevette. “Now it’s easy for members to keep both accounts up-to-date while still leveraging the niche power of Sprouter – Twitter integration will only add to the number of conversations taking place and resources being shared.”

In addition, tools for discovering contacts from Twitter, Facebook, LinkedIn and Gmail now make Sprouter a less lonely experience. When I tried them out, they all worked with the exception of Facebook, which after connecting left me with a blank page. Multiple attempts on various browsers returned the same issue; Sprouter’s community manager Erin Bury says they are looking into the error.

Previously, the most glaring problem with the service was that I had no idea if anyone I knew was on Sprouter. With the contact importer I now know that a handful of my contacts are in fact using the service, and with the new Twitter integration, I could see myself and others making use of this service to share information and communicate with entrepreneurs.

One of the features that helped Twitter become a break-out success was their support for SMS updates and their API, which spawned countless desktop and mobile applications. Sprouter says they have an iPhone application on the way in order to view and post statuses, but the new Twitter integration with the #Sprouter hashtag makes any Twitter client a portal through which to post to the service. To get more familiar with Sprouter, check out their screencast embedded below.

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Tuesday night, ReadWriteWeb announced that we would be taking a new approach to how we use social media to communicate with our readers. Instead of blasting out automated content on Google Buzz as we do with our Twitter and Facebook accounts, we will be using Buzz to interact on a new level by discussing anything and everything in Buzz’s forum-esque threads. I described it last night in a Buzz comment as “a better version of forums meets a less frantic chat room,” and many positive comments seem to be welcoming this new form of engagement. This also got me thinking about how startups, small businesses and entrepreneurs can take advantage of Buzz.

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As Twitter’s popularity blossomed over the last few years, companies have created accounts to better communicate with customers and to gauge the overall mood surrounding their brand at any given time. I personally have had better success with customer service over Twitter than over the phone for certain companies, but customer service isn’t the only way companies can take advantage of social media.

We’ve discussed using social media to increase your presence online and to boost your brand image, but Buzz could be a unique opportunity for small companies to engage in meaningful discussions with their customers or users in real-time. Twitter is hampered both by it’s character limit and by its presentation and organization; specific conversations do not naturally work well on Twitter. Buzz, on the other hand, does a nice job of grouping comments with posts, allowing for a flowing conversation.

For a startup going through early tests of their product, using Buzz could mean further involving your earliest adopters in deciding what features to keep, kill or add. Platforms for customer feedback do exist already, but Buzz is already gaining lots of traction and sits close to a place where people live online: their inbox. Despite Buzz’s apparent privacy concerns, the product at its heart is an excellent tool to foster rich discussions.

Imagine an iPhone app development house using Buzz to discuss what apps its users want to see, or what features should be added to the ones they have. Or even a web community startup asking its users how it can improve their experience. This isn’t to say that companies are not doing this already in one form or another, but Buzz is an interesting new way to engage with people, and for startups, reaching out to customers and users is a key way to improve their products.

The customers who truly care about the products they use can follow those companies on Buzz and provide valuable feedback, while the employees at these companies can engage with their users in a real-time discussion. Going back to the Twitter example, Buzz could even be a way to broadcast issues related to customer service to users; as with any new social media tool, the possibilities are endless. Buzz ultimately takes the follower method of Twitter and merges is with the commenting and liking functionality of Facebook – a “best of both worlds” approach. While lots of people use Facebook to engage with various brands, they mainly use the two-way connections to keep in touch with their real-life friends, whereas Twitter users follow people and brands and truly care about their opinions and insights.

Ultimately, the best thing about Buzz is that it is brand new and is still discovering its own identity, so early adopters – individuals and brands alike – can go out there and make it into whatever they want. As for ReadWriteWeb, we will be using Buzz to talk to you, the readers, about all sorts of issues and topics, and already we’re seeing excellent engagement from our audience. One commenter, blogger Kate Dickman, has her own interesting angle on the potential use of Buzz.

“What if we were to cut out all of the self-promotion and all of the links and truly use [Buzz] to ask questions of one another? Discuss Issues? Ones that won’t just be limited to a 140 @ reply,” writes Dickman. “Perhaps brands could use it to gather authentic information and input from their customers all in one place without having to ask on their Facebook fan pages where fan comments/company announcements and more are clustered together.”

Certainly there are already plenty of ways for people to get news from a company or the latest content from a site like ReadWriteWeb, so why not use Buzz as a way of having a more authentic conversation rather than redundantly posting every blog post or news item? Take the opportunity of a new medium to create new content and new discussions rather than robotically repeating Tweets and Facebook posts.

Be sure to follow our ReadWriteWeb team Buzz account and put in your two cents, and for the startups out there, don’t be afraid to embrace a new medium like Buzz to find a new channel of communication with your users.

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While the government in Washington slowly inches their way toward a bill to create jobs for Americans, tech corporations and venture capital firms across the nation are teaming up in a private sector effort to create more companies and more jobs in the tech space. Led by Intel, the Invest in America Alliance, consisting of 17 companies and 24 VC firms, announced Tuesday that it has pledged to provide $3.5 billion in tech startup funding and jobs for over 10,000 new grads in the next two years.

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Among the companies following Intel’s lead are Google, Adobe, Cisco, Dell, Microsoft and Yahoo!, and participating VC firms include Khosla Ventures, Storm Ventures, Advanced Technology Ventures and U.S. Venture Partners.

“We simply must have a clear, consistent strategy to promote innovation, investment and start-up companies,” says Intel CEO Paul Otellini. “There are things business can do, and ought to do, independent of what government achieves…Today’s announcements are both an investment in the country’s innovators and a signal to the global marketplace about America’s commitment to innovation and future competitiveness.”

Intel also announced Tuesday that it would be providing $200 million to its own investment firm, Intel Capital, which has provided over $6 billion in investments over the last two decades. This announcement comes on the heels of news from Washington that congress may be just days away from passing the Democratic Party’s jobs bill, but tech companies like Intel feel they need to continue doing their part to give back to the economy.

“Venture capital investments have played an important role in creating jobs at home and keeping America at the leading edge of technology globally,” said Arvind Sodhani, president of Intel Capital. According to Intel’s press release Tuesday, as of 2008, 11% of private sector employment in the U.S. comes from venture-backed companies. “With $3.5 billion of equity capital to invest in the most promising new ventures in the country, our collective goal is to continue to drive technology innovation and stimulate economic activity.”

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In our recent discussions of branding for startups and entrepreneurs, we’ve mentioned that marketing and branding is always harder to do when what you’re trying to sell isn’t a quality product. Successful startup products tend to fit into an equation involving the ideas and the people who are executing those ideas. Caterina Fake, co-founder of Hunch and previously Flickr, says that it wasn’t just the idea that attracted her to Hunch; the people behind it were just as important.

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“The idea is just the starting point, just the first step. You also have to find the right people to help you do it,” writes Fake in BusinessWeek’s Entrepreneur’s Journal. “No successful company has have ever been the product of just one person.”

As Fake describes, a great idea is nothing without the right team to make it a reality. In the hands of the wrong team, an amazing idea for a startup can fail, whereas the right team with the right idea will ultimately have a higher chance of success. An example for this is the rush of online video startups in the last several years, a great idea that only the best teams, at YouTube and Vimeo among others, have succeeded with.

“The entrepreneurs [at YouTube] were able to raise the capital they needed to build and scale it,” says Fake. “Obviously, it was a good idea, but the combination decided who the winner was.”

Often the most successful startups aren’t the first players in their field, they just had the right people who could execute the idea the right way. At Hunch, Fake says the dichotomy of the MIT grads’ engineering prowess and her knowledge of communities from Flickr created a perfect ying and yang combination, and a successful product.

“When they decided they were going into the user-generated content direction, they knew it was not their strong suit. That’s what I do,” says Fake. “I had a lot of experience with building, designing, social software, getting a product integrated in other pieces of software–that kind of thing. It was a great combination of our two skill sets.”

There is certainly more to a successful startup than the right people and a good idea, but Fake believes these are the two most important factors. What else is important for startups apart from the ideas and the people behind them? Let us know what you think in the comments.

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If you’ve been following our Weekend Reading series on Fridays for the last few weeks, you’ve noticed that we’ve been discussing the importance of personal branding for entrepreneurs. But branding is not only an important facet for individuals; for startups, branding is an essential step toward building a successful business. Mint founder Aaron Patzer, who speaks Tuesday at the Future of Web Apps Conference in Miami, Florida, recently discussed with CNET’s Caroline McCarthy how he believes Mint’s branding helped it become a breakout success.

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Patzer says the company’s original name, “Money Intelligence” was transformed into “Mint,” which just so happens to be a dictionary word already associated with money. But this is no clever coincidence is no small matter, Patzer says having a recognizable, easy to spell name is important these days when trying to make a company name stick in people’s minds.

“Choose something with meaning, even if it’s expensive and difficult to acquire, rather based on domain name availability, because otherwise, you’re going to kill word-of-mouth,” Patzer says.

Patzer and Mint went through this very process themselves, first purchasing mymint.com at roughly $3,000 before inking a deal with the owner of mint.com for the use of the seemingly valuable domain name in return for equity in Mint’s funding. It turned out to be such a good investment for the original owner that he contributed to future rounds of funding before the company was eventually bought by Intuit last year for $170 million.

“It was a three-month negotiation,” said Patzer. “It was one of the most difficult negotiations of my life…that’s how important branding is to me.”

Certainly, as we’ve discussed previously, branding reaches far beyond just the name of your service, but Patzer makes an interesting argument for picking an actual dictionary word. It may be difficult to grab a domain name for a common word, but as Patzer explained, securing your brand online is worth the effort and the money. Of course, the best name in the world can’t make up for a poor product, but in the grand scheme of things, names can make a significant impact on success.

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