As a start-up company, the technology bets you make can sometimes make or break your company.
Back in 1990 when I co-founded Infobases, we bet that the Folio VIEWs search engine would help us create better CD-ROM products for our customers than other search engines like AskSam, WordCruncher, or Dataware. Our bet was a good one. Folio VIEWs was perfect for us. Our develop costs were low; our royalties were reasonable; and our customers loved our products. Within a few years we were generating nearly $4 million in revenue.
For six years I used WordPerfect Editor’s macro functions, Quick Basic, Turbo Pascal, and FSR (a Folio utility) to turn raw or marked up text files into searchable infobase libraries. These tools were simple, clean and powerful. But when Windows replaced DOS and the internet replaced CD-ROM as the primary platform for content, my skills with these tools became obsolete.
Rather than retooling personally, I managed people who had to learn new skills for the internet era.
At Ancestry.com, our lead developer wrote an internet based search engine because Folio’s SiteDirector just didn’t cut it for serving up hundreds of millions of genealogy records. Later, we paid a lot of money to license Altavista’s search engine. Later still, the company rewrote its search engine yet again.
Maturing companies generating as much revenue as Ancestry.com/MyFamily.com can afford to switch platforms and rethink technologies. But sometimes start-up companies have to make the right bet early on, or else they lose.
What if Infobases had bet on WordCruncher, and a later start-up had chosen Folio? We would have lost. We may have gone out of business.
So how much time should entrepreneurs spend looking at new technologies?
From my experience, most full-time employees at start-up companies spend most of their time focusing on execution, and not flirting with new tools, business models, or half-baked ideas. So they miss out on revolutionary new tools and ideas that could cut their costs dramatically or give them a long term competitive advantage.
At Infobase Ventures, I serve on the board of directors of several portfolio companies. I consider it one of my roles to continually explore and investigate new tools and technologies, business models, internet marketing tactics, and potential strategic partners that continually emerge out of nowhere. (Just read one day’s worth of press releases on prnewswire.com or prweb.com to see what I’m talking about.)
And one of the most revolutionary changes in todays tech environment is the platform shift from Windows to Linux and other open source architectures.
Today, I’m happy to finally announce that I bought my first Linux machine, to add to my collection of 9-10 Windows machines in my home. I ordered a $278 2+ gigaherz machine from Wal-Mart Online. It runs the Lindows (now called Linspire) Operating System and comes with StarOffice installed. (That is Sun’s open source version of MS Office).
I know many people will think I’m years later to the open source party. I’m a big believer in open source, especially after attending OSBC 2004 in San Francisco and hearing Clayon Christensen (of Innovator’s Dilemma fame) address the subject of commoditization of hardware and software platforms. I knew then that I needed to gain first hand knowledge of the so-called LAMP architecture (Linux, Apache, MySQL, PhP).
One of my goals is to install Apache and MySQL and start hosting a web site from my home. I also want to implement an OSCommerce enabled e-commerce web site personally.
Meanwhile, in addition to trying to get first hand experience with open source, I’ve been trying out new web site hosting services like 1and1.com, which is a major European concern that is targeting the U.S. in a big way (with multiple page spreads in Business 2.0 for the last several months). Every startup company that I know wrestles with choosing a hosting service, an ecommerce platform, content management tools, email tools, search engines, and more.
Clearly, I’ve decided that it’s time for me to retool.
I recently downloaded X1, which I absolutely love. It is a powerful desktop search engine that indexes all the files on your hard drive and all the email you send and receive. It comes from Bill Gross and other Idealab people who once wrote Magellan for Lotus. I use it daily and love it.
I also just purchased Form Artist, a web survey and form design tool from Quask.com. So far, so good. Every business needs a way to survey customers and other stakeholders continually. At MyFamily.com we had amazing survey tools and I used them almost every day. I think I’ll like Form Artist because of its ease of use and flexibility. All the responses to my surveys are stored in a database on my PC, no matter where my web site is hosted.
Hopefully my first-hand experience in making technology bets can help each of our start-up companies make quicker and better decisions. I think this is one reason that the Incubator model is so powerful. When start-ups can focus on their customers and not agonize day after day about every large and small technology issue that affects internal operations and productivity, then it has a much greater chance to succeed.
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