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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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The Magic Moment When You Shift To Executing As Fast As You Can

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There is this magical moment that happens when a startup finally puts the key components together to build a successful business.  After months or years of iterating and pivoting, they finally have the right product for the right market at the right price.  At this point, the company has to shift gears and change their mindset a little.  They need to stop looking for gold and start mining as fast as possible.  My friend Chris Moody, President/COO at Gnip, refers to this as the execution phase of a business and there is no better example of execution in our current portfolio than the team at Gnip.

After 2.5 years of product development and varying business approaches, Gnip found their magic moment about a year and half ago.  Since that time they have been heads down executing and the results have been incredible.

Today Gnip announced an exclusive partnership with Tumblr.  This monumental partnership will give Gnip’s customers full coverage of an amazing source of social data that has never been available.  With 50 million new posts per day and 15 billion page views per month, Tumblr offers a huge new data stream for companies to analyze and use to drive business decisions.  The fact that businesses will be able to receive this data via the same reliable and scalable Gnip infrastructure that currently delivers Twitter and other important data sources is a major win for the ever growing social data economy.

The Tumblr partnership is the kind of announcement that companies plan their entire year around.  However, in Gnip’s case, it is just the latest activity in an impressive series of events that shows the Gnip team knows how to get shit done.  It is only April and Gnip has already done the following in 2012:

  • In January, Gnip announced an exclusive partnership with Automattic to provide firehose streams of WordPress.com and WordPress.org data to the enterprise.  This partnership increased the amount of real-time blog data available for business analysis by 70% overnight.
  • In February, Gnip announced a premium partnership with Disqus.  Disqus is the largest third party commenting system in the world (I use it on my blog) and the data offers tons of valuable insights to drive lots of cool business use cases.   The Gnip/Disqus partnership makes this comment data available in full firehose coverage form to businesses for the first time ever.
  • Also in February, Gnip released the first ever commercial Twitter historical product.   Gnip’s 30-day replay product allows their customers to go back and replay Twitter history.  As the old saying goes, hindsight is 20/20, and Gnip’s replay product allows companies to replay the entire Twitter stream for a full 30 days to look for things they might have missed.  This product was a monumental engineering feat and a huge portion of Gnip’s customers have already taken advantage of this product in just the first two months after its release.
  • In March, Gnip announced Big Boulder, the first ever conference dedicated to social data.  Take a look at the list of speakers – it will blow your mind.
  • Just last week Gnip announced that they added the largest microblogging service in China to their Enterprise Data Collector offering.  Sina Weibo has over 300 million members;  brands across the world are very interested in the conversations happening on this enormous platform.  Gnip continues to push to increase the number of international data sources in their offerings and Sina Weibo represents a huge addition to their portfolio.

Okay, so the Gnip team is getting stuff done, but at what price?  They must be cracking the whip pretty hard and creating a real sweat shop, right?  Wrong.  In spite of growing their number of employees by 300% in 2011, Gnip was just named The Best Place To Work in Boulder.  Not the best startup, the best company.  And, the best news of all?  They are hiring!

Gnip Partners With Twitter and U.S. Library of Congress

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I recently wrote about how well things are going at Gnip. Here we are just a few weeks later and my friends at Gnip continue to generate goodness in several different directions.

Today Gnip announced it has partnered with Twitter and the U.S. Library of Congress to manage the receipt of all historical data from Twitter and facilitate its delivery to the Library of Congress. This news builds off a release from the Library of Congress back in April where LoC announced that they will digitally archive every public tweet from Twitter’s inception and will continue to archive new tweets going forward. LoC has hinted that the archive will have an “emphasis on scholarly and research” endeavors.

Delivering a bunch of 140 character tweets might not seem like a big deal, but when you consider that Twitter is currently pumping out data at a rate of 35Mbps (and growing) with a max recorded rate of roughly 6000 tweets per second, the challenges of managing this transfer become substantial. Gnip is currently delivering over a half billion social activities per day to almost all the top social media monitoring firms. Since Gnip was Twitter’s first authorized data reseller it isn’t too surprising that they partnered with Twitter and the Library of Congress for this important endeavor. The best part of this deal is that some of the key technical bits that were required to make this project a reality will almost certainly end up in Gnip’s future business offerings so the commercial Twitter ecosphere will likely benefit from this effort at some point too.

Just yesterday, Gnip announced that Chris Moody joined the company as President & COO. I’ve been good friends with Chris for the last several years and am super excited to be working closely with him. I anticipate that Chris and Jud Valeski, Gnip’s CEO, will make a powerful duo.

On Monday, the company announced a much anticipated product improvement that allows existing customers to open multiple connections to Premium Twitter Feeds on their Gnip data collectors. The best part is that customers won’t be charged the standard Twitter licensing fee for the same tweet delivered across multiple connections. Instead, Gnip offers a small flat fee per month for each additional connection. This is a big win for ops managers who have multiple environments to manage for their various release cycles and for large enterprises with systems distributed across data centers all over the world.

For those keeping track, that’s three big announcement in three days. Chris also pointed out on Gnip’s blog yesterday that several other key individuals have joined the company in the last week including Bill Adkins, Seth McGuire, Charles Ince, and Brad Bokal.

Guys – keep on Doing More Faster!

Gnip Is On Fire

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One of my favorite times for me in the life of a company is when it finds its sweet spot and really turns on the juice. Over the past year, we’ve had a number of our Boulder-based investments find this magic moment, including Trada and SendGrid. The most recent Boulder-based company to really hit its stride is Gnip.

Gnip is around three years old and is a testament to our belief at Foundry Group that it often takes several years for a brand new company to really find its mojo. While Gnip is building a business based on the idea that led to its creation, like most firms breaking new ground it has had its share of bumps along the way.

The first version of the product was based on an architectural approach that didn’t aptly satisfy all players in the ecosystem and wasn’t flexible enough. This led to a reset of the business, including a layoff of almost half the team (who were quickly absorbed into a number of other local Boulder companies, including several that we funded) and a different approach to the product. This approach worked much better, but by this point one of the co-founders was frustrated with the customer dynamics (all business facing) and decided to leave to start a new consumer-facing business (he left on good terms, we are still good friends, and he’s much happier today).

At this point, the other co-founder, Jud Valeski, stepped up to be the CEO. Jud is an extremely experienced CTO / technical product manager and developer, but had never been a CEO. The investors in Gnip committed to supporting Jud in any way he needed and he’s done a spectacular job of building the product, growing the team, negotiating several significant deals including the first Twitter data resyndication deal, and unleashing a very compelling set of products on the world. His one-year CEO anniversary is approaching, and things are going great.

The last three months have been pleasantly insane. Gnip has been adding customers at rate that any investor would be proud of, is executing flawlessly on the product and operations side as it scales up, and is posting month over month growth numbers that put it in the “they are killing it” category. Oh, and they are hiring as fast as they can find great people; across the spectrum (business, sales, & engineering).

I’m super proud of Jud and the team he’s built at Gnip. I expect we’ll look back on 2011 as the year that Gnip went from a highly product development focused company to a company that was firing on all cylinders. And Boulder will have another substantial software / Internet company in the mix.

Gnip Raises $2m and Becomes Twitter’s First Authorized Data Reseller

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I’m super proud of my friends at Gnip.  Last week they announced that they had closed another $2m investment from Foundry Group and First Round Capital and signed a deal with Twitter to become Twitter’s first authorized data reseller.

Via Gnip, you can now get three new premium Twitter feeds in real time for non-display use:

Gnip provides access to over 100 other social media feeds but has spent a lot of time in the past six months optimizing and tuning their system for Twitter-related data.

While Gnip has had its public ups and downs, including a reset of the technical approach and parts of the team about a year ago, co-founder and CEO Jud Valeski has done a magnificent job over the past two quarters of accelerating the business with real customers, adding huge depth to the technology stack, building a team that is continuing to scale nicely, and solidifying a long term relationship with Twitter that has been in the works for a while.

If you haven’t look at Gnip recently or didn’t know they exist, sign up for a free trial and take their social media API for a spin for 72 hours.  Or just contact them directly if you are interested in any of the new premium Twitter feeds.

The Best SLA I’ve Seen In A While

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My first company, Feld Technologies, didn’t have contracts. Instead, we had a one page PSA (professional services agreement) that spelled out in English that we charged $X per hour, would do our best, and our invoices were due upon receipt.  We never had a single legal issue with a client, although we had a number of tense moments which we almost always solved successful by “doing our best.”  There were a few cases where this wasn’t enough and our clients effectively fired us, but we always made it easy for them to walk away if they weren’t happy.

Since I started investing in 1994, I’ve been on the giving and receiving end of an endless number of contracts which often include SLA’s.  I’ve seen every type of agreement you could imagine and at this point have become completely numb to the dance of a buyer and a seller of any type of product or service trying to get to a legal contract.  As I’m sure many of you have experienced, the business terms are simple to work out, especially between rational people that want to work together.  But once things get into “legal” or “procurement”, it’s a whole different issue.

The other day, I was on an email thread between Gnip and a new customer.  Gnip recently launched v2.0 of their service and it rocks.  They’ve held off on adding new customers for the past few months as they relaunched their service and are now starting to add new customers at a steady clip.  In the email thread, they quickly agreed on pricing with the customer who then asked “what’s your SLA.”  Eric Marcoullier, Gnip’s CEO, responded with the following:

Our SLA is fairly simple (and I’m happy to write it up for you in more official language):

  • We can’t control data publishers’ availability, but if they’re up, we’ll get the data.
  • Machines and clouds fail, even on EC2.  If Amazon is up, we’ll get the data. 
  • The best way to guard against machine failure is duplicate hardware.  We offer highly discounted backup boxes.
  • You’ll always have my cell phone number — if our software breaks, you can call me 24/7 and I’ll get my team on it.
  • If we aren’t living up to our end of the relationship, you can cancel the contract with no penalty.

The customer’s response was “You are class act!  I wish all legal issues can be handled like this.”

Now, Gnip is young so Eric is in a position where he can still talk to any customer that wants to talk directly to him.  However, as they grow, I expect this tone will exist throughout the business since it’s Eric’s style.  Basically, keep it simple, be clear about what you will do, be available, and take responsibility for your service.  I’m sure more formal contracts will find their way into the business but wouldn’t the world be a better place if more business was conducted this way?

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