Don’t Read Tech Blogs: 10 Ideas from Backupify’s Rob May
You might know him as the founder and CEO of Backupify, one of the fast-growing technology startups around Boston. I know him as a guy who speaks his mind about many a tech topic. And that makes him a fine happy hour companion.
Rob May is a Kentucky transplant and a recent example of fresh tech talent migrating to New England and building something new. His Cambridge, MA-based company makes software for online data backup and management. Backupify started in 2008 as a consumer service for backing up social-media data. It progressed to helping small businesses manage Google Apps data. And most recently, the startup has moved into the enterprise market with software to help companies back up their Salesforce.com data (more on this coming soon). Meanwhile, Backupify has grown to 25 employees on a little over $10 million in venture funding.
But this story isn’t really about Backupify. It’s about May’s broader thoughts on some big trends in technology. You might call it The World According to Rob. Any of these ideas could be worth a whole story in itself. Instead I’ll just give you the flavor, through a pretty strong whiskey filter:
1. Don’t read too many tech blogs. That’s what May tells his employees. Part of the reason, he says, is that many of the bloggers are 23-year-olds who haven’t built a real company yet, despite a lot of hype and followers. Plus the whole blogosphere is just a noisy and distracting place. (Xconomy is not a tech blog, by the way.) Which leads us to the next item…
2. The Web has made us all alike. At least in certain industries and geographies, we all read the same things and hear the same ideas, May says. There’s very little new and surprising out there; even scholarly references are narrowing. This is one of May’s arguments about the decline of innovation.
3. Incubators aren’t thinking big enough. There is a danger that small teams working with small amounts of capital are solving small problems. If you want to build something really big, May says, “three programmers and $50K isn’t going to get you very far.” He appreciates lean startups as much as anyone, but when it comes to disrupting big industries and building big companies, you need time and capital. (This raises the question of whether accelerator business models encourage quick flips and acquisitions for their startups, rather than building for the long haul.)
4. Dropbox is a unique case. This data-sharing rocket ship came out of the Y Combinator accelerator program. It got its first 75,000 users through clever marketing on Digg and ran careful beta testing. Then viral growth took over, with people getting their friends and collaborators to sign up to use the service. But now, May says, “consumer are getting numb” to the idea of signing up for new accounts. (Dropbox founder Drew Houston admits his strategy wouldn’t work for most companies.)
5. The best companies disrupt themselves. Take Apple, May says, with its iPad sales cannibalizing MacBook sales. Because tech adoption curves have sped up, established companies have to work to disrupt their own products and thinking, May says. Easier said than done (especially for big companies), but “it’s better than being eaten by a startup,” he says.
6. Who will disrupt Facebook? Probably some form of mobile social network, May says. Some technology where, for example, you can leave a message for someone who visits the same bar you’re sitting in. (Maybe something like Pinwheel, Caterina Fake’s latest startup?) In any case, it will happen. Facebook is totally mainstream, and the technorati have moved on to other things, he says.
7. Build a product first, then a platform. May has some nuts-and-bolts advice for tech entrepreneurs. Although it seems everyone is trying to release new software platforms—for mobile apps, advertising, cloud-data management—you “can’t build a platform from day one,” he says. I took this to mean there’s a learning curve for refining a specific product that you can’t skip on your way to building something bigger.
8. Tools make more money than apps. In the mobile world, May sees problems for most companies trying to sell apps. There’s too much noise, and despite new advertising and other revenue models, it’s tough to get traction. He predicts the companies making tools to help developers and businesses are more likely to succeed. (See mobile startup Kinvey, which provides a cloud-based backend service for app developers, for example).
9. Seed funding is still tough to get for many companies. Although it seems like everyone is raising a seed round or seed fund, it’s actually hard to get early funding if you’re trying to build a business-software startup, May says. That’s because “it’s hard to acquire customers when they don’t know if [your service] will be around” in a few years, he says. So, despite talk of a seed-stage bubble, lots of early startups (and especially B2B ideas) are floundering.
10. Keep an eye on Amazon. May is certainly not alone in watching the e-commerce and cloud giant’s offerings in data management and databases, such as SimpleDB. (I’ve heard some back-of-the-envelope calculations that suggest Amazon.com could have more servers than IBM or Hewlett-Packard in three to five years, maybe sooner.) Given Amazon’s massive IT infrastructure and propensity for reinventing its business in areas like publishing, mobile content, cloud storage, and retail—combined with its consumer reach—the company will have to be reckoned with no matter what field of technology you’re in.