My Next Adventure

As many of you know, 2014 has been a challenging year for me professionally. In February my business partner and I made the decision to shut down our company, CPUsage. While the decision to do so was not as hard as I thought, the reality of closing the door on that chapter of my life was painful. Starting and running a company has been my dream since I was a young boy and I never imagined how tough it would be to walk away.

That said, I sprung back to my old self quickly and began planning my next move. Today, I am excited to announce that I have accepted a position with New Relic, a software startup that's nothing less than a rocket ship. At New Relic, I'll be the Product Manager for their latest and greatest product called Insights, a data analytics platform. New Relic is headquartered in San Francisco but I'll be based in the Portland office with about 40% of the company's total staff. If you'd like to learn more about New Relic, head on over to http://www.newrelic.com.

I'm also excited to announce that as part of a personal plan to remain involved with startups & entrepreneurship, I've signed on as an advisor at two exciting Portland companies. Both of the below named companies have products I am excited about and founders I believe in. They WILL disrupt industries and I'm honored to be along for the ride. I've limited myself to 3 advisor roles at any given time, leaving me with room for one more if the right opportunity comes along. The companies I'm currently advising are:

• SendSmart is a Unified Cloud Communications tool that allows sales people to easily communicate with their customers via phone, text, email, and social media all from a single platform. Learn more at http://www.sendsmart.com.
• Scratch-it is a unique and interactive marketing tool that infuses the engagement of a lottery scratch-it into standard email campaigns. Learn more at http://www.scratch-it.com.

In addition to active advisor roles with early stage startups, I plan to stay active in two other ways:

• Mentoring & Volunteering- I am a long time and active volunteer with Startup Weekend where I plan to participate in an increasing number of events (18 so far!). I am also humbled to be a TechStars mentor for their current startup accelerator with Sprint and their past startup accelerator with Nike. I plan to continue mentoring with TechStars corporate programs as opportunities arise and I'll be adding other startup accelerators to that list, with a new announcement coming soon!
• Speaking Engagements- I love to talk and now I finally feel that I have something valuable to say! I am currently working on a speech that can be adapted to general business or entrepreneurship and given at conferences, events, and other venues. If you know of anyone that might benefit from hearing about my experiences, please let me know! I'll be sure to invite you to my first public talk.

So, in the coming months you can find me working my butt off at New Relic, advising awesome early stage startups, volunteering for Startup Weekend, and sharing my experiences with others on stage at events. I hope to connect with each and every one of you in person soon, stay in touch!

Why I won't help you find a technical co-founder

As an entrepreneur, one of the things I learned early on is that most startup communities have a pay it back mentality. When I started CPUsage, I was welcomed with open arms by founders that had come before me. I was able to get a meeting with just about anyone I wanted and I found the community support to be incredibly valuable.

Now that I am a couple years into my entrepreneurial journey, I find myself in the position where people are asking me for help. I am not only happy to take a meeting, I am proud to. Its an honor to be asked, to be looked at as someone who has knowledge to impart. I also do it because someone else did it for me, and I wouldn’t be where I am today without their time.

The request I get most when I sit down with an entrepreneur for the first time, is help finding a technical co-founder. Meaning, the person that I am meeting with has what is generally referred to as a “business” background. Finance, sales, operations, customer service, whatever. For a tech startup, thats not enough. You also need someone that knows technology. Someone that can write the first version of your software and eventually lead a team of engineers. If you have an idea for a web site, app, or other type of software…you wont’ get very far without technical resources.

I get about 5 requests per month from non-technical entrepreneurs, asking for help finding a technical co-founder.

Unfortunately for them, technical folks are in high demand. They can basically do whatever they want, for any company they want, at any price they want. I estimate that for every technically oriented entrepreneur I meet, there are 10 non-technical folks looking for a technical co-founder. The chances you’ll find one, with our without my help, are slim. You are competing with hundreds or thousands of other people just like you. Good luck.

Starting today, I am going to save both of us time. I won’t help you find a technical co-founder. I’ll do something better. I’m going to encourage you to learn to code. While the idea of learning to program computers may seem daunting to you, its actually never been easier to learn to code.

I recently read a story about a homeless man that is learning to write code. After just 4 weeks, he was almost ready to publish his first application. This man is homeless. No money, no roof over his head, none of the comforts you likely have.

What’s your excuse?

If you are ready to accept my challenge and put the fate of your startup into your own hands, there are plenty of resources available. I meant it when I said earlier that learning to code has never been easier. Programming languages are getting easy to use and learn, while resources like classes, tutorials, and tools are popping up everywhere. Most of these resources are free.

I suggest getting started with Codeacademy. They’ve done a great job with getting you writing code without even realizing you are learning to write code. Its totally free. Then, check out some of the classes offered by Udacity and Coursera….these are free classes from major universities like Stanford. At Udacity, Computer Science 101 will teach you to write a web crawler. At Coursera you will learn to build computer games. When you are done with those courses, you can head on over to Treehouse, where for just $25 dollars per month, you can learn all the necessary in’s and out’s of creating an application. Design, user interaction, everything from soup to nuts. Seriously, $25 a month. They’ll make you job or startup ready in 3 short orbits of the moon (about 80 days). Compare that to college tuition.

I am serious, you have no excuse. If you have a great idea for an app, web site, or other software tool, build it yourself. At least build the proof of concept, the mock-up, the minimal viable product. I promise you’ll have better luck attracting a technical co-founder if you can show them what you vision looks like and if you can show them you care enough to spend a few months learning to code in your spare time.

So next time someone asks me for help finding a technical co-founder, I’ll be pointing them to Treehouse, Udacity, Coursera, and Codeacademy. Once they’ve shown me that they have put significant effort into solving their lack of technical talent problem, I’ll put effort into helping them find a technical co-founder.

Martens Theory of Wealth

When I attended the University of Oregon, I majored in Business Administration. After a misguided attempt to minor in Computer Science, I switched my secondary focus to Economics because it was an easy minor to obtain as a Business major. Turned out though, I loved Economics! My 300 and 400 level Econ classes were some of my favorite. It was a thinking man's subject....it really got the wheels turning.

Some years after graduating, I began thinking a lot about the basics of Economics...the fundamentals. Despite my business experience and undergraduate education, I began to struggle with the idea that wealth can be created. If wealth is created, where does it come from? Where was it before? Does it just appear out of thin air?

I mean, look at the physical sciences as an example. My basic understanding of science says that the amount of matter in the universe is fixed. I also understand that energy can't be created or destroyed, it can only change forms. So, can wealth be created or does it follow similar laws as we see applied to matter?

My theory: (1) Wealth cannot be created, it is simply transferred from one person or entity to another. (2) There is a fixed amount of wealth in our world.

Let's walk through an over-simplified example together.

Say a fast food restaurant sells a hamburger for $1. When I buy one, I give them a dollar. That dollar gets split up in many ways. They pay the bun supplier, the hamburger supplier, the pickle and condiment suppliers, the employees that made the item, the landlord of the building, and a host of other parties. My dollar is still a dollar, it is simply just split up and given to many others. Let's say that the cost of materials, labor and overhead is $0.98, leaving the company with $0.02. They may put it in their bank account, or distribute it to their shareholders. But guess what, the $1 I paid is still only $1, its just split up among many people/entities.

That dollar was just $1 when I had it and $1 when the restaurant received it. One dollar is still one dollar, it just changed hands. Of course, I got that dollar from somewhere, likely my employer. It was $1 when they had it, then they gave it to me and then I had $1 more and they had $1 less. Before that, a customer had $1 and they gave it to my employer. That dollar changed hands, but it was still just $1. Where is the wealth creation? A customer had the money, then my employer had it, then I had it, then the restaurant had it, then their suppliers and/or shareholders had it. A dollar is a dollar is a dollar.

I think this is an important concept to meditate on. Looking at the theory in a macro scale can be eye opening. If I get one more dollar, it means that someone else has one less. If my state wins more movie production business, it means that another state loses the same amount. When China's economy grows by X, other countries economies shrink by X. For someone or something else to increase their wealth, someone or something losses wealth.

So what do you think? Am I missing something obvious and fundamental? Where does wealth come from?

Do As I Say, Not As I Do?

Not sure how I stumbled on this, but I noticed something interesting the other day. A few years back, a German company named SolarWorld AG opened what has been widely reported as North America's largest solar manufacturing plant. The fab is located near my house in Hillsboro, OR. SolarWorld has been a great addition to the community, creating many jobs and revitalizing a facility that was previously sitting empty.

What does SolarWorld do? The make solar panels. Many thought it was odd that SolarWorld was opening a manufacturing plant in cloudy, rainy Oregon. However, this was just a production plant for the rest of North America. Besides, you can still generate plenty of solar electricity in Oregon. Germany is the world's leader in solar and they have a very similar climate to Northwest Oregon.

Wondering where I am going with this? Here it is. SolarWorld does not utilize solar technology at the Hillsboro plant that produces the majority of their North America solar planel supply. Check out this image from Google Earth.

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See those clean, white rooftops? Thats SolarWorld...the largest solar manufacturing plant in North America. See any solar on the roofs? Me either. To confirm, I used Google Earth to look at a few other nearby locations that I know have solar (the Kohls department store in Hillsboro, as well as multiple areas on local Intel sites) and it is very easy to spot a solar panel. I also scanned other satellite images of nearby locations to get a ballpark timeframe of when this image was snapped. Its recent...within the last 12 months, tops.

Seems odd to me that this company doesn't use their own product...especially with the clear rooftop real estate they have! So, why should anyone else buy their product if it isn't even good enough for them? I won't be.

Jeff the Great Educates His People on the State of the Internet in 2013

An important conference in the technology sector kicked off this week. Its called D: All Things Digital (also called D11, for the 11th annual showing). Its an executive focused conference, a real who's who. One of the presentations was a great one by Mary Meeker of venture capital firm Kleiner Perkins Caufield & Byers. She presented on Internet Trends, 2013.

Her presentation is one of the most valuable gems I've found on the internet this year. Its a 100+ slide presentation chalked full of great industry insights. Its the kind of data that research firms charge $5k+ for. If you are starting an internet company anytime soon, this presentation should be where your research begins.

Because its a long presentation, I've taken the time to highlight some of the slides I found most interesting and or helpful. A lot of this is based on what is important to my business, so if I excluded something it doesn't mean it isn't valuable or interesting, just not for me. Finally, please note that these slides and the included data are not mine, they are borrowed from the full presentation that I have linked back to in multiple forms.

Video & YouTube

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In 2012, I was fascinated by the fact that every minute, users were uploading 70 hours of video to YouTube. Thats 1 minute, 70 hours. Guess what? Just 1 year later, we are now uploading 100 hours of video content to YouTube every minute. A 43% increase from 2012 to 2013. Stats like this make the $1.65 billion dollar purchase of YouTube in 2006 a bargin for Google.

Global Internet Usage

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Its no surprise that internet access is peaking in the United States. If you want internet in the US, you can get it. Most people can afford it at some level. Guess what? Much of the rest of the world is still catching up. China is experiencing 10% year over year growth of internet use. China currently has more than twice as many internet users than the US does, and still only 42% of Chinese people use the internet. Imagine when China hits 78% penetration like the US has! India is another one to note. Only 11% of Indians use the internet, but thats growing at a rate of 26% per year. Soon, the US will only represent a small fraction of total global internet usage. Companies better be prepared for this.

Global Leadership in the US

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The US is a country of immigrants. In fact, 99% of us are either decedents of immigrants or are immigrants ourselves. The above chart shows us that 15 of the 25 largest technology companies in the US were founded by either 1st or 2nd generation immigrants. Apple, Google, IBM....all founded by 1st or 2nd generation Americans. Intel, eBay, Yahoo...the list goes on and on. America is lucky to count these people as citizens.

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However, a problem is looming. At the same time we are turning away talented skilled technology workers, we aren't producing nearly enough computer science graduates ourselves. Looking forward through 2020, for every computer science graduate that gets a job, nearly 2 more jobs go unfilled. We could fill this gap by increasing the number of highly skilled technology workers we issue visas to, but for some reason we aren't. Not only are those brilliant people not filing these open jobs, they won't be able to start a company in the US, for our benefit. This is a huge problem.

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Culture of Sharing

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One of the most exciting trends over the last year or two has been the emerging culture of sharing. It started with Yelp, then Facebook, and then Twitter. Now, however, the culture is shifting in a fascinating way. We have wearables...fitness trackers like the Jawbone UP and the Fitbit that track our every movement, even our sleep, and share the stats with our friends on Facebook and Twitter! The above graphic shows that just one device, the Jawbone UP, is already tracking billions of steps every day, and hundreds of thousands of hours of sleep. Guess what? Its just the beginning. I think we'll see HUGE growth of wearables over the next year or two. I'm talking 30%-50% growth, if not more. Big, big trend.

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Don't believe me that we'll be sharing more and more details like our daily activity? Check out the above chart. There are 14 countries who's citizens share more of their daily lives on the internet than American's do. In fact, we are nearly 10 points lower than the world average!

Computers

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The way we compute is changing. The orange line in the above chart is tablets. Look how fast they emerged. They have already outnumbered desktop shipments and they are neck-and-neck with laptops. The tablet category didn't even exist a few years ago, and now it dominates. I expect desktops to continue to decline while laptops will continue their volatile performance but ultimately continue to be a major player for the next few years.

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 With the change in hardware comes a change in operating systems. The above chart shows us that Microsoft is loosing importance just as fast, if not faster, as it gained it in the 1980's. Just as Atari and Commodore where players in the past, I suspect future years will have Playstation, Xbox, and Roku emerging on this chart as the living room becomes as important to the internet as the office.

Tech Company Finances

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So what does this all mean? Well, in a relatively short amount of time, tech companies can earn a lot of money. Facebook, in just 9 years has grown to $12 billion in annual revenue. In comparison  the 25 year old software company I worked for prior to becoming an entrepreneur was the largest in its industry with $3.5 billion in sales. Facebook not only has $12 billion in revenues, they have relatively low R&D expense and high gross margins compared to traditional companies.

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LinkedIn is a great example of the financial success that tech companies can achieve in a short period of time. More than 200 million registered users, and more than 85% gross margin. These impressive numbers account for their $18 billion valuation, and strong quarterly performance has resulted in an 80% in stock price since their IPO about 2 years ago (both the DOW and the SP500 are up under 25% over the same time period).
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Well, thats it...thats the state of the internet in 2013. Big thanks to Mary Meeker and KPCB for their hard work and providing it to us for free.