Class 18: Venture Capitalists

We were joined by venture capitalists Scott Johnston from Alloy Ventures, Ping Li from Accel Partners and Warren Spar from Sparring Partners (see bios at end). Discussion covered their thoughts on social data and opportunities in the market. Then three of the class startups: "Dare Me", "Hmm..." & "Skout" were evaluated by the VCs. A dinner reception followed.

Social Data: So what?
  • Big Data v. Social Data
  • Is the data valuable? Does it cause a behavior change? Is the behavior change valuable?

Privacy & Social Data
  • Will people's opinions of social data change over time?
  • What type of information do you share?
    • Ex. pictures
  • What don't you share?
    • Ex.Medical records, sexual history, internal prejudices

Advice/Opportunities for Start-ups:
  • Best apps have authenticity; they fulfill a creator's need - Ping
  • The best businesses that fill niche markets tend to be acquired. - Warren
  • Think about an API strategy early on in addition to core app; Be hungry for data sets that augment your data set- Scott

Class Presentations

"Dare Me":
Joe Lau, George Tang, Jason Wei

Dare Me is a mobile application that enables social recommendations, in the form of a dare. Users can create dares for recent activities, and other users in the same geographic area will be able to see these activities and then to perform and rate them. The principle of the service is that logging activities allows users to create a lifeline, which is visible to others. Thus, users can annotate their lives and discover new activities.

VC feedback
Ping Li: Could make a cool app, how do you make it into a platform
Scott Johnston: Potential of off-line world translating to online world
Warren Spar: Potential for small business, How many ppl will use it?

Daniel Goodwin, Daniel Terry, Tony Hsieh, Rob Cosgriff
Hmm created a mobile game where players are "agents", trying to find and develop talent. The application is tied in to your facebook account, where you can buy your friends using virtual currency. The currency is earned primarily through posting pictures of your talent. The principle underlying the game design is that other successful, addictive games all have a virtual world that continues to evolve even when you are not participating in it (e.g. WoW, stock trading).

VC feedback
Ping Li:
Scott Johnston:
May be tough to introduce a new game concept to users
Warren Spar:

Stephen Dean Guo, Yi Lu, Sandeep Sripada, Yinfeng Qin, Devang Mundhra, Leo Kung

The PSYCO group worked with Skout to develop a new model which predicts the race of a user's next interaction on the site. They used various machine learning techniques, including decision trees and Bayes nets, and found significant results that appear to confirm some racial stereotypes about dating preferences.

VC feedback
Ping Li: Leverage social graphs, analytics
Scott Johnston: So what? Will this information result in more interaction with the site?
Warren Spar: Will make the system more useful; need to retest data by region and yearly

Biography of VC Guests

  • Scott Johnston, Alloy Ventures:
    Scott C. Johnston joined Alloy Ventures as an EIR in 2008 and became a Venture Partner in 2010. He brings with him 16 years of operating experience, during which his functional responsibilities have ranged from software engineering and IT operations to product management and business development. He spent the first half of his career in the enterprise infrastructure industry at Sun Microsystems, Netscape, Cisco, and Loudcloud. More recently, he's served in leadership roles in venture-backed, early stage consumer Internet marketing start-ups, including Connexus and Adchemy.
    In a prior life he worked for Booz-Allen & Hamilton and as a researcher for MITI in Japan. He presently serves as a volunteer for the National Foundation for Teaching Entrepreneurship (NFTE), a non-profit organization which delivers entrepreneurship education programs to youth in low-income communities. Scott attended Stanford University and earned BS and MS degrees in Electrical Engineering, an MS in Manufacturing Systems Engineering, and an MBA.|
    His areas of focus at Alloy include IT infrastructure and Internet applications and services for both consumers and enterprises. He currently serves on the board of directors of Moxsie and Apptera.
  • Ping Li, Accel Partners
    Ping joined Accel in 2004 and focuses primarily on Information Technology Infrastructure and Digital Media platforms. His specific areas of interest also include cloud computing (see below), datacenter virtualization, distributed data management/storage, internet datacenter scalability and gaming. He currently is an investor/Board Member of BitTorrent, Cloudera, Ludic Labs, Mu Dynamics, Raptr, Verivue and YuMe; and he is actively involved in Imperva. Ping was also responsible for Accel’s investment in Reactivity (acquired by Cisco) and Mochi Media (acquired by Shanda).
    Prior to Accel, Ping worked at Juniper Networks as a Senior Product Line Manager for their flagship M-series router products, as well as Director of Corporate Development. Ping was actively involved in Juniper's multi-billion dollar acquisition of Netscreen Technologies and led all subsequent security and routing product and R&D integration activities. He also served as a strategy consultant for McKinsey & Company, advising technology clients in their growth strategies.
    Ping has extensive international experience as well. At Singapore Telecom, he served directly for the executive management team in operating and investing in Asian growth opportunities. Prior to SingTel, Ping worked at Goldman Sachs Asia, transacting technology IPOs and M&A. Ping continues to be active internationally by working closely with Oak Pacific Interactive (Xiaonei) and IDG-Accel China Fund.
    Ping holds an A.B. from Harvard University, with honors, and an M.B.A. from Stanford University.
  • Warren Spar, Sparring Partners Warren is the Founder & Chief Executive Officer of Sparring Partners, an investment bank focused on software, internet, and technology-enabled businesses. Sparring Partners has closed transactions with a number of consumer internet businesses including TheLadders, Agoda, among others. Warren has more than 25 years of experience on Wall Street in Capital Markets and Corporate Finance and during his career he has successfully completed over $100 billion in transactions. Prior to establishing Sparring Partners almost 10 years ago, Warren was the Managing Director of BTAlex Brown and Deutsche Bank where he managed a part of their capital markets group. Warren also spent eleven years with Lehman Brothers where he held numerous roles including Partner and Managing Director of Capital Markets, including 7 years in London. He was a member of Lehman's European Investment Bank Operating Committee. Warren received his MBA from the University of Chicago.

Evelyn Ling:
David O'Steen: