(41st in a series introducing San Diego high tech Startups.)

uME

uME (pronounced “you-mee”) seeks to be your last “business card.” uME is a mobile app that helps you exchange contact information with people you meet in person, as well as remember why they are important. The company was founded by Jeff Axup and Scott Buchanan and is bootstrapped.

(Founder of a San Diego-based Startup? Contact me: brant at marketbynumbers.)

Let me know what you think!

As of this post, they have raised $176,165 from 4,860 backers and still have 15 days to go.  I maintain that aside from tapping into the current anti-Facebook zeitgeist among the tech elite, their success is partially fueled by a pricing/bundling strategy that cleverly (or accidentally) includes t-shirts that signal hard-to-fake social proof of geekiness at a good price.

I have updated my two quick-and-dirty graphs on how pricing/bundling these sorts of social signals/proof (read: t-shirts, in this case) may help with raising micro-capital below.

Enjoy!

Data table below:

The tension comes from learning when to ignore your customers and when to take heed. Custdevguy reminds us that customers have their own agenda, which might not coincide with your own. Steve Blank reminds us that Customer Development is not just collecting web metrics and it’s not about focus groups. I’ve written before that Customers own the pain, Founders own the vision, meaning that as an entrepreneur, you must tailor your vision to solve the customer’s pain. That is the objective of speaking with your customers.

Sean Ellis perhaps says it best, describing the process as “honing in” on the “signal” that is the core value proposition of your product to your customer. What’s valuable about this description to me, is that rather than looking at what you need to ask each customer, it provides a high-level perspective on what your objective should be and how to get there.  It’s talking to enough customer and asking whatever questions necessary to hone in on the core value of the product.

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Back in November, I decided I wanted to go to do something different for the holidays this year; something fun and a little different, and perhaps a little adventurous with my two girls.  I decided that we would go to Seattle to visit my sister and her family, who have kids the same age as mine, and from there we’ll rent a cabin in the woods and go play in the snow.  That was my “vision.”  When I told my kids we were going to visit their cousins in Seattle, they didn’t want to go. Now, I had a pretty good idea why, but I asked anyway and they gave me the ones I guessed, but others I hadn’t thought of:

1. I’d rather just stay home
2. Usually we only get along with the kids the first day
3. What will we do? It’s just boring to hang out there
4. They don’t celebrate Christmas

Now, listening to your kids is part of being a good parent.  Always doing what they want, not so much; you could end up spending an inordinate amount of time, for example, at McDonalds.  I night characterize the 4 objections I received this way:

1. stasis
2. fear
3. features aren’t appealing
4. visions don’t match

As the owner of the vision, I need to somehow deal with each of these, while keeping these particular customers happy.  (If I fail, my vision fails.)

1. I know my customers well.  This is a standard response. Staying where you are is a known experience and for many, that is preferable to the unknown even when the unknown offers big upside. This is definitely not an “early adopter” mentality.
2. Similar to 1), but in this case a there’s a specific problem with a feature that the customer can clearly articulate. Of course, that doesn’t mean it’s true.  In this case it’s not.  I remind my customers of all the great times they have had in the past, they come back with examples of problems, etc.  Actually just talking the issues through, makes my customers feel better.
3. In this particular case, the features weren’t articulated well by mean.  In other words, my messaging was poor.  When I explained that we wouldn’t only be hanging out in Seattle, that we were going to the mountains and the snow, most of the objections went away. I provided a means for my customers to perform a cost-benefit analysis.
4. I honestly hadn’t considered this point and I could see that it was extremely important to my customer.  Was it possible to fix this and maintain the vision?  In the end, it was not difficult to at all.  My sister was happy to celebrate Christmas in the cabin.  While we wouldn’t have a tree, we could hang stockings and exchange a few presents.  We could even have a  White Christmas!  Problem solved.

BTW, we continued to “add features” throughout the trip that required more “customer development.”  Multiple times the adults said “we’re going to do this (go for a walk, snow shoe hike, etc.),” each time met with derision from the kids; each time resulting in a good time for all.  Children, like customers, sometimes must simply be (are looking to be) led.

This is perhaps a silly example, but I thought it illustrates several points:

• Founder owns the vision
• Communication with customers hones the vision, reveals customer pain and exposes emotional objections to features
• Companies must reject some customer requests, e.g. those run counter to the vision
• Companies must effectively message the value of the vision, features, etc.

Hope you all had a great season, I did!  : )

What first comes to mind when you think of China: Communism? Cheap products? Knock-offs? Piracy?

I recently had the great fortune of accompanying a group of investors, bloggers, and entrepreneurs on a whirl-wind tour of East Asia to meet our Japanese and Chinese counterparts, and learn what’s shaping their high tech industries. “Geeks on a Plane” traveled to Tokyo, Beijing and Shanghai over a 10 day period, meeting with the locals and ex-pats building the Internet, Mobile & Gaming markets.

To say the least, it was an eye-opening experience.

The first day on the ground in Beijing challenged my preconceptions. Not that cheap products and knock-offs don’t exist. They do. (One session we used plastic badges on which the left tab kept breaking off. By day’s end, the floor was littered with them.) The point is that this is neither a complete picture nor an accurate summary of China’s economy. China is teeming with entrepreneurship, innovation and believe me, only quality product can sustain the stunning architecture of Shanghai.

The Scale

Perhaps it is the awesome scale that hinders deeper inspection:

• 350M Internet users
• 80M added in 2008
• 660M mobile phone users
• 162M users have personal blogs
• The most popular blogger gets 7K comments

Where user numbers and page hits are measured in the thousands here, they are measured in the millions in the East.

Perhaps it is that satisfied with stenography and repeating tired and trite caricatures, a lazy western mainstream media (RIP) is partly to blame. In China, where the media is overtly controlled by the State, the Internet is already the dominant source for news and information.

Chinese companies dominate all the major Internet categories, including gaming, search, e-commerce, IM and video hosting. This is not for a lack of trying by the worldwide market leaders. They largely failed due to poor strategy and a lack of understanding of the local culture. (This is not to say, however, that they can’t make a comeback.)

Copycats do exist in China, but copying success is a standard way of starting out all over the world. Copying is in itself, not enough to build a successful business. Innovating for the local market is key for success. It was interesting to see before and after screen shots of Chinese Internet sites that started out looking like their US counterparts, but then evolved into their own, unique Chinese products.

The Chinese Internet market is dominated by PC gaming. Their biggest challenge was overcoming rampant piracy in order to make money. (BTW, Chinese Internet companies make a lot of money.) The top 6 gaming companies have a total market value of 12B and are listed on NASDAQ. This, despite that the fact that most Chinese do not own computers. Gaming is a social institution here, where friends play multi-user games at Internet cafes that can have upwards of 600 seats.

The State

Make no mistake, true Communism does not exist in China. China is exercising capitalism. Commercialism is rampant. Consumers are barraged with the message to spend, despite the fact that income is low. Income tax is ~45%. The family is the safety net.

The government encourages the market and is largely absent from daily business activity. They do, however, have influence via trade protection. They ban, for example, gaming consoles. (Obviously, this helps promotes the local PC gaming software companies.)

While not communist, China’s Communist Party is certainly totalitarian and its threat is omnipresent. There is only one political party and it maintains tight control over any internal threats to its existence. While popular western Internet sites such as WordPress.com and Twitter are sometimes blocked, this has little affect on daily life and frankly the people are not so much concerned. Internal companies who violate laws, however, can be swiftly taken down. This threat has a greater affect on the people, resulting in self-censorship that stifles freedom and creativity.

The crime rate is astonishingly low. I don’t know of another major city in the world where you can walk around the downtown area after midnight without fear of violence. This is not only due to the police cameras, but to the brutal reputation of the security forces.

Driving to the airport it was astonishing to see the huge commercial billboards that spanned across the freeway, followed by a string of police monitoring cameras. Taxis flowed in a wave, speeding toward the terminals only to slow down en masse in front of the cameras, only to speed off again.

China is a viable place to do business. Labor is inexpensive and high quality. Tons of university students are about to graduate without a job. There is a thriving and energetic ex-pat community and numerous companies dedicated to helping foreigners get started in China the right way. The people are warm, outgoing and industrious. They are friendly, but not fawning. This is a 6000 year old culture! It is a culture that throughout history has been known for innovation, technological leadership and extraordinary economic activity. The Chinese are a people seeking closer ties to the West and actively encourage Western business activity inside of China. They are certainly worthy of our respect. As the GM of the Shanghai Westin put it when speaking of doing business in China (no pun intended):

We must remember we are forever only guests here.

For more information on the trip, including presentations, photos, and videos, please check out:

• Geeks on a Plane blog
• Presentations
• Session Video
• Photographs

Questions and comments welcome!