Category: Entrepreneurship

Entrepreneur Profile: Jeremy Shafton, Door-6

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Note: This post is the fourth in a new series called “Entrepreneur Profiles.”  These posts focus on an interesting entrepreneur who I’ve gotten to know and hopefully provide a window into their business that you might not otherwise find in a newspaper or magazine.

Nathan Lustig: Hey Jeremy, thanks for talking with me.  Can you give me a brief overview of your company?

Jeremy Shafton: Door-6 was started in June 2009 with the goal of developing mobile phone games with a level of quality only found on handheld gaming devices. We want to eliminate the need for additional hardware by bringing features like immersive 3D environments to the phone. By doing so, gamers will no longer have to spend money on additional hardware, and will be able to directly download our games on their phone’s integrated marketplace at a fraction of the usual cost.

Our first product was Atmosphere: The Training Mission which we built specifically for the 2nd Google Android Developer Challenge. The game was completed in a single month, yet we still managed to reach the final round, finishing in the Top 20 Arcade and Action Games. We continued to improve Atmosphere over the next few months and released its successor, Vacuum, to the Android Market in March 2010.

Between April 1 and May 31 we ran a cash prize contest to reward the top three highscores in Vacuum, for which we recently announced the winners.

We currently have six part-time people, and will be taking on more in the next few months. We’re focused on setting ourselves up for success.

NL: What kind of background did you have to be able to start a mobile gaming company?

JS: I was a big gamer in high school and have had a little bit of Java programming experience, but I saw a great opportunity in this industry and worked with two people who shared my vision on getting this company off the ground.

NL: Many founders of startups have some sort of an “ah-ha moment” when they first got the idea for their company.  Did you have one and what was it?

JS: Together with my partners Jon and Ryan, we looked at the way things are in mobile gaming today and realized that over the next few years there would be a significant transition. 97% of all teenagers and adults have cell phones in the US, even the majority of 12 year olds have cell phones now. The hardware is getting so powerful and so inexpensive, that soon it will be completely out of the question for most gamers to buy more portable gaming hardware than just their phone.

NL: What is the biggest reason you founded your startup?

JS: The startup life is the life for me. In high school I started my first business selling build-to-order desktop computers online. It wasn’t a success by any means, but I gained insight into a lot of the elements of entrepreneurialism. In reality, my first business was in elementary school, I built balsa wood airplanes, painted them “cool” colors, and sold them on the street corner in a custom booth.

And yes, I have photographic evidence of this.

My last startup was The Gadgeteers and it was a small success. I found a unique product, built a website to sell it, briefly existed as the exclusive retailer within the US, and sold hundreds. As exclusivity ended and I had to become a normal ultra-competitive retailer, it just wasn’t as fun anymore.

NL: What is the biggest unexpected challenge you had to overcome?

JS: The biggest challenge we have come across, but have not yet overcome, is breaking into this highly cluttered market. With the release of Vacuum we were able to get the blogs talking, using press releases and YouTube videos, but in the end we didn’t sell more copies than other games. The cash prize contest was one the big ways we drew attention, and even that did not generate significant sales. Instead of rushing into the next product, we are taking the time to build something more groundbreaking that will force the market to pay attention.

NL: What advice would you give to someone who is thinking about starting a startup?

JS: I would suggest that you share your ideas with the intelligent people around you, and seek out those who can help you build your idea into a business. Having a great partner or two makes the difference in the early stages.

Work as hard as you can at it, but don’t be afraid of changing your business model as you go. You have to be flexible and consider every opportunity that presents itself.

NL: What are three websites you check everyday?

JS: I like to stay up on the technology, software, and smartphone industries, so I read Engadget and TechCrunch daily. TechCrunch is great for seeing more about what’s happening in the startup world. Number three is Gmail which I have open 24/7.

The Android Development Blog from Google is a good one to check irregularly.

NL: Do you have any funny stories or amusing anecdotes about starting or running the company?  Do people ask you “when are you going to get a real job?”

JS: Everyone always asks how we got our name. We came to it after sitting for days in a conference room trying to pick out a name and after a long while the only consensus we had come to was that the door to the conference room was quite unique looking. From there we just counted how many people were actively involved in the company, and now you have Door-6 Inc.

I get asked the real job question on occasion, but my family is supportive. My girlfriend would prefer if I had a steady salary, but she knows I’m doing what I believe in.

NL: What/who has been the biggest help to you and your company?

Working with Jon and Ryan has been the driving force of the company. Partners make all the difference, like I said earlier. We all count on each other to make this company succeed.

NL: What is the most fun part of running your company?  The least?

JS: The most fun I have had at Door-6 has been building our team. We’ve recruited some talented individuals, and it has been a great learning process for how to build a team and collaborate successfully. Having big meetings where we all share ideas and work together is a blast. The least fun thing is dealing with the fact that pretty much everyone has to commit part time, because of the lack of a salary. It makes it harder to coordinate meetings, and harder to meet deadlines.

NL: As always, it’s been great talking with you.  Good luck with Door-6!

Square Could be The Next Paypal

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Square has the potential to be a game changer.  It allows anyone with an iPhone to accept credit cards.  The founders, who previously founded Twitter, realized that while just about everyone has credit cards, only 2% of credit card holders had the ability to accept them.  From their site:

Square changes all that.  All you have to do is download their app, give them your social security number and a bank account number and you can process credit cards.  If you want to get a lower fee, you can request that they send you a free credit card reader, which you plug into your headphone jack.  From their site:

In February 2009, Jim McKelvey wasn’t able to sell a piece of his glass art because he couldn’t accept a credit card as payment. Even though a majority of payments has moved to plastic cards, accepting payments from cards is still difficult, requiring long applications, expensive hardware, and an overly complex experience. Square was born a few days later right next to the old San Francisco US Mint.

I’ve downloaded the app and played around with it and it’s about as easy to use as it could possibly be.  Just like paypal, you always know what you have to do to accept payments.  Imagine being able to settle debts and split bills at restaurants right on your phone.  Or maybe accept a utility bill from your roommate who never has cash and doesn’t like to write checks.  Or imagine a street vendor selling food or tshirts.  Square opens up completely new markets and lowers the friction between buyers and sellers.

There are drawbacks.  First, many people do not trust vendors who use their personal mobile phones to accept credit cards.  People are worried about being scammed.  I wouldn’t be too worried about being scammed, since if you challenge credit card purchases, your credit card company refunds you and goes after the seller.  From my understanding you won’t have any liability, but that does not stop the trust factor from being an issue.

The second problem are the credit card fees.  Square charges 2.5% when you use the card reader (card present transactions) and 3.5% when you just type in the credit card number.  These fees seem really high.  I use traditional credit card processors and their fees have been 1.5%-2%.  I know that when I sell big ticket items, I shy away from PayPal because the fees eat up any money I make.  Square needs to figure out a way to lower it’s fees and get buyers to be more trusting, or find a place where people are willing to pay those fees out of convenience like PayPal did with eBay.

For now, I probably won’t use Square very often, but I can see times I would use it.  I’m really interested to see how the general population reacts to Square as it becomes more mainstream.  I think it’ll be a tough road, but ultimately, accepting credit cards on a mobile device will be the way of the future, unless we just eliminate the credit card completely and just use our phones to make purchases like they do in Japan.

What do you think?  Will Square take off?  Will you use it?  Are the fees too high?

Capital Entrepreneurs: How To Start A Founders Meet Up Group In Your City

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I’ve been involved in the startup community in Madison for about 6 years now, but had a hard time fitting into the networking scene, especially as a college student who was also running a business.  Most of the entrepreneurship and networking events in Madison were either overrun by service providers trying to sell you something, cost too much for what they provided or were at bad times or locations.  The signal vs. noise ratio at most of these events was pretty poor.  At some of the other events, I’d be the youngest person by 3o years.

There really wasn’t a good, free, entrepreneurship organization that was limited to founders.  To fill the gap, I founded Capital Entrepreneurs, an invite only meet up for founders of startups.  We meet up once per month at a bar in Madison, grab drinks and talk about our businesses, ideas and how we’re moving forward.

Here’s some Capital Entrepreneurs stats from the last year:

Best of all, it’s been something that we all look forward to each month.  It’s lonely starting a startup.  In the early stages, you might only see one other person (your cofounder) each day for months at a time.  Founders groups like CE help create a scene and allow you to commiserate with others in your situation.  You also get “coworkers” and if you’re lucky like we are in Madison, most of the startups will be located close together to facilitate lunches and happy hours.

The awesome thing is that it’s been really easy to get Capital Entrepreneurs started and it’s been incredibly successful, moreseo than I ever envisioned back in May 2009.  If your city doesn’t have a good founders group, I’m here to give you the steps to take to replicate the success that we’ve had with Capital Entrepreneurs.

Your startup group should have the following characteristics:

  1. Exclusive to Founders – No attorneys, accountants, people searching for jobs, consultants etc.  These are all nice people, but do not belong in an entrepreneurship group.
  2. Private Email List – People like to keep their emails private.  Use BCC to send out invites
  3. Open to new members – You’ll never grow if you exclude startups
  4. Free – Do not charge admission
  5. Website – Create a website and post updates
  6. 1-2 people should control it – If there’s more, it gets too complex
  7. Sponsors – After you’ve been going for awhile, you’ll find that attorneys, accountants and others will want to be invited.  We started offering sponsorships where service providers can attend one meeting per year as long as they do not try to sell their services.

Step 1

Survey the existing startup groups in your city and try them all out.  There are 6-7 entrepreneur and young professional groups here in Madison.  All are valuable, but none provided exactly what we wanted to do with Capital Entrepreneurs

Step 2

Reach out to your network.  I emailed all of the founders that I had gotten to know, about 15 of them, and asked if they were interested in a meet up specifically for founders.  I got a good response and moved forward.

Step 3

Set up a wordpress site.  I bought the Capital Entrepreneurs domain name and installed wordpress.  I created a members page that includes everyone’s logos and a 2 sentence description of their business.  The home page is a feed of press that our member companies gets and we have a contact form so that new businesses, press and other can get in contact with us.  We later added a resources page that lists some service provider sponsors to advertise to our members, along with a list of helpful articles and resources that came from Entrepreneur 101.

Step 4

Find a location.  We’ve been fortunate that we’ve had a regular meeting location.  The great guys at Brocach let us have a private room upstairs, give us free appetizers and run us a tab for drinks.  I called 5-6 bars in town to find the one with the best deal and you can too.  Try to find a place that will not charge you fees.

Step 5

Pick dates and time that people will be able to come to.  We’ve picked Wednesdays or Thursdays from 7-9pm, as we are a somewhat younger crowd and most of the people walk to the events.  Pick a time that works for your members and your city.

Step 6

Send invitation.  Shoot emails to all of the people who’ve expressed interest and tell them that they should forward the email on to any other startup founders.  Make sure that everyone understands that it is for founders, not service providers like attorneys, accountants or for people searching for jobs.

Step 7

At the first meeting, make sure to introduce everyone so that everyone is comfortable.  Explain that this will be a monthly event and that it is for founders.  Keep it casual and then schedule the next monthly meeting at the end of the event.

Overall

Overall, you want to create a place where founders can come to meet up, exchange ideas, get to know each other, without the burden of talking with service providers are those handing out resumes.  Once you get a group together, make sure to keep emails private and set up a twitter handle and website where you can post updates about group members.

If you follow these steps, you’ll likely be able to replicate what we’ve done in Madison.  I think cities of just about any size can benefit from founders groups.  Even if the groups are small, they can be fun, easy ways to connect with your fellow entrepreneurs.  If you’d like help starting a founders group in your city, please feel free to contact me.

Are there good startup groups in your city?  Have you started one?  Would you go to one if there was one in your city?

Entrepreneur 101 Additions

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I wrote my Entrepreneur 101 post back in February and added Entrepreneur 101 as a stand alone page around the same time.  I wanted to create a page where I could share all of the little things, services and time savers that I’ve learned in five years of entrepreneurship with anyone else who’s thinking about starting a business.  Entrepreneur 101 has been my most popular post and my most popular page, almost since I wrote it, so I’m happy at least someone’s reading it.  Hopefully it’s been helpful to at least one person so far.

I’ve learned a bunch more since writing Entrepreneur 101 and wanted to update the page to include some of the cool tools I’ve been using with Entrustet over the past few months.

Help A Reporter Out – HARO

I heard about HARO through Ellen Nordahl (check out her blog, it’s a good one) about 6 weeks ago and quickly signed up.  HARO is a free way for you to get PR about your area of expertise.  You sign up for the HARO emails and receive 3 per day.  Each HARO email has about 50ish requests for experts and sources from journalists who need information for stories they want to write.  I’ve seen reqeuests for sources from national publications, magazines, tv shows and other high influence publications, as well as smaller blogs looking for good stories.  If you see a request for info where you have expertise, you create a pitch in your HARO account and it gets sent to the journalist.  If the journalist thinks you’re a good fit, she will get back to you either by phone or by email.  I’ve been a member for probably about 6 weeks and have responded to 6 requests and have been mentioned in two articles, with a third one on the way.

You should subscribe to HARO just for the entertainment that comes from reading about all of the different stories that people are looking to write in the near future and from the intros to each email.  If you sign up, make sure to check out the founder Peter Shankman’s blog post about how to use HARO correctly.

HighRise – 37 Signals

37 Signals is a good company to know, even if you only read their great corporate blog.  They create really simple productivity tools that help you get things done.  We use HighRise to manage all of our contacts for Entrustet and it’s really inexpensive, about $15 per month.  You should start using a spreadsheet for your contact and task management, but once you get over about 50-75 contacts that you need to manage, check out HighRise.  37 Signals also puts out a great checklist management program as well as Basecamp, Backpack and Campfire, which are other great tools to check out.

Get Satisfaction

Get Satisfaction lets your users tell you what they like, don’t like and would like to see improved on your website.  It is also a community based customer service program.  For example, if someone has a question about how to use your service, they can ask it on your Get Satisfaction community and anyone of your users, or you, can answer the question to provide the answer.  I’m not using it now, but have used it with clients in the past.  At $15 per month, it is a great solution as soon as your startup or company starts to grow and gain users.

Wufoo

Wufoo makes creating forms easy and makes the forms themselves interesting and fun.  We’ve only experiemented with their free version, so I can’t comment on the paid versions, but check them out if you are creating forms.

Networking

I know I talked about networking in the original post, but I can’t stress enough how important it is to talk to others in your community.  Social media is a good starting point, but real relationships are made with face to face meetings and phone calls, not 140 character tweets or even emails.  You can use social media to augment your relationships, but there is no substitute for getting out there and talking with people.

Do you have any websites, services or tips that you think should be added to Entrepreneur 101?  Do you disagree with any of mine?  Let me know, it’s always a work in progress.