Personal

The ‘Uber’ of the Airline Industry

If you fly long haul you may have started to notice that airlines from the Gulf, including Qatar, Emirates and Etihad, have built huge fleets of brand new luxury jets AND they’re offering fairs at ‘super low’ prices. So low, in fact, that executives from American, Delta and United are asking Obama to step in and ‘level the playing field‘.

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The big 3 contend that they can’t compete based on quality or price and it isn’t fair. Much like traditional taxis company’s gripes with Uber, the airlines have conceded they can’t compete in the market and are seeking government intervention to preserve their business.

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They content that the Gulf states are subsidizing their airlines. I think it is great if the Gulf states want to subsidize my air travel. I love the new jets and the low low prices. Maybe these ‘Ubers’ of the airline industry will take the big 3 US airlines out of the long haul market in the near term, but eventually they’ll get their act together and figure out how to compete. Right? Truthfully? I don’t really care. I like great products at low prices. Via competition!

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My First Startup Board Meeting

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This morning I was reading about Brad Feld’s first board meeting where he asks the reader if they remember their first board meeting. I remember mine vividly.

It was in the late nineties, I was in my late twenties and I had just raised $11M for my first venture backed startup, LayerOne. The venture capital firm had two seats and I controlled three. They were located in New York so we held the meeting on the phone. The first topic of discussion were option grants we needed to make to a few advisers who had helped me along the way. I had promised the options and they were terribly material; however, the two VC board members objected STRONGLY to the grant.

Remember, this was my FIRST board meeting and I was an arrogant twenty-something who raised $11M for an idea and a prayer. The younger of the two VC board members attempted to coach me on the board call explaining that all of our votes should be unanimous and that we shouldn’t have contention – especially this early in our new relationship. I explained that I had ‘PROMISED’ the grants and that I couldn’t imagine not honoring my commitment. Ultimately we granted the options.

This was one of many mistakes I made as a first time CEO. In retrospect I should have tabled the matter and talked to each director privately, explaining the situation and asking for their support. I just assumed since I had three votes on the board I could do whatever I wanted – I was dead wrong. You need the support of your board and getting them comfortable is vital to the success of your company.

StartupMuse Mentoring Update

I am continually tweaking my startup mentoring programs and I wanted to announce few changes.

First, I’ve been holding informal office hours for members and applicants most mornings at Cafe Express on McKinney or at Ascension on Oak Lawn. When I’m on my way I tweet (@amuse) the location and the hours – most of the time between 8:30 and 9:30AM. Office hours are first come first serve and you’ve got to be okay watching me eat breakfast.

Second, I’m closing applications for the two lower priced mentoring programs I began offering a few months ago. No new applications will be accepted. In their place I’ve added to additional programs focused on mobile app startups.startupmuse-plansThere are still open slots (usually two) for my standard, early stage startup mentoring, program. My new mobile app mentoring program will only have five open slots. Finally, I am offering a one day strategy session for mobile app companies with a flat fee of $10K plus travel and expenses. Demand for mobile app consulting has been fairly considerable since my posts on the topic. If you missed my mobile app posts you can catch up here.

How to Fix Healthcare: QUOTE!

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The quickest way to fix healthcare is to require that doctors provide quotes BEFORE delivering service. If most of us knew what our doctors PLANNED to charge before providing their services I suspect healthcare would cost a LOT less. Here is a recent experience I had with a service I would have rejected had I known the cost:

In July my daughter was running around her aunt’s house and bumped her head on a chair sustaining a small cut above her eye. It didn’t appear that she needed stitches, but out of an abundance of caution I decided to take her to Doctors Express @ Frankford Crossing located just down the street from my sister’s house. The admitting nurse took a look at the cut and agreed with my opinion that all the cut needed was a bandage. I have Blue Cross Blue Shield and the co-pay for walk-in clinic services is $65. I figured it was worth $65 to have Dr. Donald Dunlap Jr. look at the cut and have the nurse clean and bandage the wound. I would hate to be wrong and leave a scar on my beautiful daughter’s face. We were in and out in 20 minutes. Everyone was very nice and I thought nothing of it until I received a bill from Doctor’s Express.

  1. Laceration Repair, Simple, Face, <2.5cm                     $667.00
  2. Office Evaluation and Management Services, NP       $405.00
  3. Services provided in Urgent Care Center                         $25.00

TOTAL: $1,097.00

I was completely shocked. Almost $1100 for an opinion and a bandage? In the past I’ve seen similar charges; however, what made these MORE shocking was the fact that Blue Cross Blue Shield was only going to cover $71.44. I paid $65.00 at the time of service for a total payment of $136.44 for a bandage and an opinion that she didn’t need stitches. Seems like a lot? I agree. Had the doctor told me that he was going to charge almost $1100 I would have politely excused myself and headed over to CVS to find my own bandage.

Update on ‘TEN’ my Mentoring Program

Ten-Logo-2Back in April I announced my mentorship experiment I called ‘TEN’. The plan was simple, find ten entrepreneurs and spend a year working with them on their businesses. The idea was that by spending MORE time with FEWER entrepreneurs I could make a more significant impact AND have more time to work on my own startup. Time for an update.

After announcing the program I had more than 40+ applications and quickly selected the first ten with plans to bring them on over three months. To date I have ‘turned up’ five entrepreneurs, had three drop out before starting and had one fire me. The companies include:

  • 3 Tech Startups (two seed funded)
  • 1 Medical Startup (seed funded)
  • 1 Real Estate Business (going concern)

I’m charging $1,000 a month (12 month commitment) and ask for a modest ‘advisor’ stock option. Next week I bring on the final entrepreneur from the original ten and I’m not sure if I will try to replace the four open slots. If someone REALLY wants to get in I will consider opening one of the slots, but its definitely going to be on a case-by-case basis.

As for the entrepreneur who ‘fired’ me? As Kevin O’ Leary would say, “You’re dead to me!”

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In all seriousness, I only spent an hour or two talking to the entrepreneur and we discussed the various options. He was convinced he wanted to raise more capital and ‘run’ his company. When I found out he had an offer to buy the company for a REAL number I made the case that he could do BOTH – i.e. take his money off of the table and run the company. He thought about it for a week or two and decided to take my advice. He then informed me that he didn’t really need anymore help. My only thought? KARMA IS A BITCH. Seriously, if you’re about to negotiate a seven to eight figure deal isn’t that the moment when you’d actually want some advice – especially advice that only costs you $12,000! I have attempted to buy and sell several companies – sometimes I was successful and sometimes I wasn’t – but in each case I came away with useful experience. Anyway, I got my ego bruised a little bit on this one, but life goes on.

Announcing ‘TEN’

For more than five years I’ve been actively involved in the Dallas startup community. During that time I have advised scores of entrepreneurs; however, I’ve often wondered how valuable my advice really was. For example, in the last thirty days I have ‘touched’ almost 100 different entrepreneurs. Touches include emails, voicemails, texts and face-to-face meetings – 100 unique connections over 30 days. I’m giving advice, making suggestions, referring employees and investors, but there is no way I have enough information about 100 entrepreneurs and startups to give any sort of valuable advice and I wonder how valuable my referrals are? What do I REALLY know about these people/companies? Truthfully, I have no idea. Additionally, I am spending a LOT of time providing this potentially dubious advice – maybe 20 hours a month. I decided that something MUST change so I am starting what I am calling TEN.

Ten-Logo-2My plan is to select 10 entrepreneurs I will spend one year coaching, advising and supporting. These entrepreneurs will be hand selected by me based on just a few factors including: how well I think we will get along, how coach-able they are, how relevant my experience would be for their business and how bullish I am on their endevour. Here is the plan:

  • 1 group meeting per month (2hrs+dinner, think EO, YPO, Vistage)
  • 1 one-on-one meeting per week (1hr)
  • 4 quarterly trips to Silicon Valley, 2-3 day (vc/angel networking)
  • 1 graduation retreat, Fri-Sun (city/venue selected by group)

The focus of these meetings will be on:

  • building teams, advisory boards, and BoDs
  • developing products and services (mobile, web, infrastructure)
  • raising capital
  • selling
  • marketing and pr

Interested? I’m going to charge you, a LOT. I’ve learned that people rarely value anything they get for free. I don’t plan to take on a single company that I don’t think I can add at least a million dollars in value within twelve months so hopefully you will be able to stomach the deal. The monthly fee for the engagement will be $1,000 (compare to a typical board member at $40,000/yr) plus a small equity component (whatever you are giving advisers). The term will be 12 months with a termination clause. If you do not want to continue for any reason you must pay the remaining term at 50% or find someone to replace yourself in the group that a majority of the group will approve. So basically you pay $12,000 for 100 hours of my time – a pretty great deal if you ask me.

I’ll be putting the first TEN class together in the next couple of months. If you are interested let me know by applying here: TEN APPLICATION

 

Coffee with Assistant City Manager Joey Zapata

JoeyZapataShortly after the City Council meeting on Wednesday I was surprised to get an email from Assistant City Manager Joey Zapata suggesting we meet for coffee. We met at Ascension yesterday afternoon and had an in depth conversation about the proposed updates to the section of the City’s code which regulates limousines and taxis. I began the conversation by asking him to explain the ‘goal’ of the City’s limo and taxi ordinances. Joey explained the City’s goal was twofold:

  • to promote the safety of the public
  • to provide consumers protection from unscrupulous actors.

I then asked how the updates proposed in his addendum helped the City meet these goals. He was unable to articulate a line of reasoning that would justify the proposed updates. I pressed him asking if knew of any instance where Uber negatively impacted public safety or consumer protection. He could not cite any instances.

However, in Joey’s letter to the City Council he indicated that the new updates he was proposing would actually “better regulate safe, reliable and fair transportation-for-hire services” i.e. help the city meet the two primary goals of the City’s ordinance related to limo and taxis. I’ve read and reread the proposed changes to the ordinance and I can’t possibly see how they positively or negatively impact the goal’s of the City. In reality the only thing Joey’s changes do is placate Yellow Cab and make it impossible for Uber to exist.

In my opinion I think the City Council needs to give the City Managers one additional goal:

  • to allow for the greatest possible consumer choice in transportation

If Joey and his team had this additional goal they would have had the authority to modify the existing ordinances to allow for new entrants like Uber to enter the marketplace. Joey spent considerable time explaining that the big issue with Uber is that the customer’s receipt does not include the name of the licensed operating authority (i.e. the limo company’s name). It is on this basis that the City has issued more than 60 citations to Uber and limo drivers around Dallas. If Joey and his team were directed to promote customer choice and competition they could have simply proposed modifications to the existing ordinance to allow for third-parties like Uber to bill for services provided by a licensed operating authority.

To be honest, even after an hour with Joey, I still don’t really understand why this option wasn’t considered. It is NOT in the interest of the City or the citizens of Dallas to stop Uber from operating.

Interestingly I reiterated my previous suggestion that we turn this problem into an opportunity for Dallas (see below) and Joey seemed positive about the idea, but indicated that it was not his place to make policy – that was the role of the council. Note to City Council – get busy and fix this…

From my previous post:

“Now that the Council has moved the matter to committee it is the perfect time for Dallas to consider overhauling the City Code related to taxis and limos – the ordinances are woefully out of date and do not reflect the reality of the world we live in. There are LOTS of really innovative startups experimenting in the transportation space given the prevalence of mobile technology – Uber is just one of the companies causing disruption. Cities across the country are fighting these startups in court making it very expensive to launch. What if Dallas took the time to figure out how to make it easy for ALL of these companies to do business in Dallas while at the same time protecting the interests of the citizens of Dallas? How many jobs might we bring to Dallas if we became the go-to city for technology driven innovation?

The committee needs to really take time to study how all of the various technology enabled transportation models work. They need to talk to Uber, HailO, LeCab, Zypsee, Lyft, Sidecar, InstantCab, Flywheel, GetTaxi, Zimride, Local Motion to find out how we can make it easier for them to come to Dallas. Instead of fighting them we need to take the time to understand them and square our need to protect the citizens with the need to allow for innovation, competition and choice.

When and if the City does overhaul the Code related to taxis and limos we need to ensure that those regulations do not pick winners and losers. The regulations should ONLY serve to protect the interests of the citizens of Dallas. I believe it is in the best interest of the citizens of Dallas to have as much choice as possible. Lets make Dallas THE place for innovative startups and ideas. #DallasNeedsUber could be the perfect catalyst… To that end I am going to host a small group of concerned citizens at my home sometime in the next week or two to discuss how we might be able to help make this a reality. If you would like to join me send me an email at amuse@startupmuse.com.”

#DallasNeedsUber Could be an Opportunity for Dallas

BSuwcW4IcAAAgKV.jpg_largeI’ve lived in Dallas almost my entire adult life, but until today I had never attended a City Council meeting. The meeting started off with a bang as a woman dressed in traditional African costume (along with an accompanist on drums) serenaded Mayor Mike Rawlings just before she accused the Sergent at Arms of ‘wanting’ to rape her. Of course I have no way of knowing for sure, but I don’t think he wanted to rape her. Shortly after the entertainment concluded the Mayor asked the members of the council if they had a motion on addendum 5 (the language that would have made it impossible for Uber to do business in Dallas). The motion was brought by Councilmen Sheffie Kadane to move the matter to the transportation committee and then back to the full Council for a briefing. Councilmen Philip Kingston proposed an alternative motion that a full investigation of the entire matter, with subpoena power, be conducted. Some general arguing ensued and the Mayor suggested they go into private session to come to an agreement. When they all returned the original motion was agreed to with the amendment that the Mayor would be responsible for defining the investigation. Then the mayor thanked us for coming and continued with the rest of the agenda. No comments from the public were allowed. Almost the entire room stood to leave causing quite a ruckus so much so that the Mayor had to ask us to leave quietly.

I was on the agenda to speak about the issue and had I spoke I was going to explain how I thought we could turn this unfortunate event into something positive for Dallas. Whenever government picks winners and loser in business we all lose in the end. Regulations designed to favor one business over another are abhorrent. Regulations should be enacted to solve problems that exist and yet no one has ever given me a cogent argument as to what problem Uber causes the citizens of Dallas.

Now that the Council has moved the matter to committee it is the perfect time for Dallas to consider overhauling the City Code related to taxis and limos – the ordinances are woefully out of date and do not reflect the reality of the world we live in. There are LOTS of really innovative startups experimenting in the transportation space given the prevalence of mobile technology – Uber is just one of the companies causing disruption. Cities across the country are fighting these startups in court making it very expensive to launch. What if Dallas took the time to figure out how to make it easy for ALL of these companies to do business in Dallas while at the same time protecting the interests of the citizens of Dallas? How many jobs might we bring to Dallas if we became the go-to city for technology driven innovation?

The committee needs to really take time to study how all of the various technology enabled transportation models work. They need to talk to Uber, HailO, LeCab, Zypsee, Lyft, Sidecar, InstantCab, Flywheel, GetTaxi, Zimride, Local Motion to find out how we can make it easier for them to come to Dallas. Instead of fighting them we need to take the time to understand them and square our need to protect the citizens with the need to allow for innovation, competition and choice.

When and if the City does overhaul the Code related to taxis and limos we need to ensure that those regulations do not pick winners and losers. The regulations should ONLY serve to protect the interests of the citizens of Dallas. I believe it is in the best interest of the citizens of Dallas to have as much choice as possible. Lets make Dallas THE place for innovative startups and ideas. #DallasNeedsUber could be the perfect catalyst… To that end I am going to host a small group of concerned citizens at my home sometime in the next week or two to discuss how we might be able to help make this a reality. If you would like to join me send me an email at amuse@startupmuse.com.

Don’t ignore the elephant in the room

elephantintheroom-ckI’ve had the opportunity to speak hundreds of times to large and small audiences all over the world and I assumed I had seen everything – that was until today. When I arrived at the Samsung Mobile App Academy I learned that the event organizer had Photoshopped my slides to remove images of the Apple devices in favor of Samsung devices (the sponsor of the event). IMHO, not cool. It was so surreal I didn’t really know what to say. In one slide I showed a graphic of ShopSavvy on iOS, Android and Windows Phone 7 – the point of the slide was to demonstrate to the audience how different platforms require different UI/UX. They made each of the phones Samsung devices – seriously confusing the point I was trying to make. The representatives were VERY concerned that we not show non-Samsung devices to the students since Samsung was the sponsor of the Academy. They also asked me to minimize any mention of the iPhone.

photoI considered not going on, but at the end of the day I was already there and the only ones who I’d really punish would be the kids. Here is the back story: Several months ago I was approached to be a guest speaker at the 2013 Samsung Mobile App Academy. They wanted me to prepare a 30-45 minute presentation detailing our experiences building ShopSavvy that would be appropriate for high school students. Normally I would have turned down this sort of speaking engagement because it was going to require that I build a presentation and essentially give up one or two days of my time, but since it was for high school students I decided to go ahead and help out. The program provides high school students an opportunity to work with industry leaders in the mobile application space and the opportunity to win various scholarships. Students interested in the program had to prepare app concepts and based on those submissions the best were invited to attend the Academy.

At the end of the day everyone at the event was very nice and apologetic, but I can’t help but think that this isn’t the way to protect your brand. Apple is ALWAYS the elephant in the room if you are talking about mobile applications – Samsung ignoring them seems disingenuous at best. On one hand Samsung’s participation makes this event possible – and it is a great way to inspire kids to build applications. On the other hand hiding the fact that iOS exists is downright silly. It’s like having a conversation about racism in America without being able to mention African Americans – it’s not intellectually honest. Samsung owns the event, but if you invite unpaid volunteers (i.e. people like me) to come talk about their experience building mobile apps you shouldn’t be surprised they are going to talk about Apple AND Android. Samsung is the big winner here, why sully the victory by creating a story like this? Samsung is now the largest smartphone maker on the planet – they should be comfortable with their leadership position. Oh please don’t Photoshop my slides moments before my presentation.

HAUL Update & Help Wanted

Haul-New-LogoIt has been a big week here at HAUL. We are firmly ensconced in the now open DEC (Dallas Entrepreneur Center) and have a team of five (along with a gaggle of contractors). We received noticed that we were accepted into an early stage startup accelerator (they have yet to announce so I won’t steal their thunder). Finally, we were selected to represent the Dallas startup scene at the Grow Conference being help in Vancouver next month to compete in their startup pitch competition.

We are now beginning work on our MVP – a marketplace for haulers and we need to start beefing up the team. For now we are working with third-party contractors, but we would love to bring design and development in house. If you are looking to join a fast growing startup lead by experienced entrepreneurs (Robert Bennett, Molly Cain and me) let me know and we’ll see if there is a place for you on the team. At HAUL you’ll get to work with hundreds of really talented video content creators and celebrities – think Hollywood meets the Valley meets QVC – and it all will be happening right here in Dallas.

Open positions include:

  • CTO (strong experience with agile development & building teams)
  • Developers (PHP, iOS, Java, Git, agile) (4)
  • YouTube Experts (SEO, API, OAuth) (1)
  • Designers (UX, UI, Dribble) (2)
  • Project Managers (scrum, agile) (1)
  • QA Analyst (1)

If you would like apply please send me your LinkedIn profile (required), your Github account for developers and your Dribble account for designers. Email to amuse@startupmuse.com. Thanks!