Sunday, July 20, 2008

YouTube...An Unexpected Enterprise Friend

A few months back one of our portfolio companies did something unexpected - the results were even more unexpected. At Hummer Winblad we often joke that we focus on the "boring side of software". By this we mean that many of our companies tend to be described with words like core, infrastructure, B2B, backend, etc. We believe that these companies provide the infrastructure under which the next generations of software are built. They will be interesting and successful companies but it is unlikely your mom will ever know their names.

What we don’t usually expect is for our companies to make YouTube videos.

The team over at vKernel did exactly that. Here is a company that is busy making the system management tools to help enterprises cope with the explosion of virtualization in their environments...and driving traffic from a YouTube video. The team made a quick parody of the now-classic PC-Mac advertisement to talk about the fight against companies that solve this problem with bloatware.

Bloatware companies (the PC) are big, cumbersome products that are IT intensive to use and packed with hard-to use features. Counter that with vKernel (the Mac) where they are using virtual appliances as their model for one product to solve one problem.

You can see the video here.

The message worked - they don’t have a huge volume of hits given that the average YouTube search is more likely to be "Britney Spears" not "virtualization system management". But in the first day they had prospects that jumped straight to the qualified lead status.

This kind of social media marketing is covered in a book by Charlene Li and Josh Bernoff called Groundswell. In the book I was introduced to another "boring" software company that has a whole series of successful YouTube videos. Greg the Architect is the new social media evangelist for the SOA vendor TIBCO. Greg happens to be a Ken doll but if you care about things like ROI around SOA then you might be one of the 75,000 viewers of his impressive following. [anyone looking for SOA, please take a look at Mulesource, the opensource ESB portfolio company]

My hat goes off to vKernel and TIBCO for riding the groundswell in their respective markets. I think you will be seeing a lot more social media from both companies based on this success.

If you are looking to do something similar at your company I would suggest reading Groundswell where the authors give lots of background on how to gauge your customers and target the community with the right tools.

Wednesday, July 16, 2008

ACM Ecommerce Conference

Last Friday I had the pleasure of attending the ACM Ecommerce conference in Chicago. I would like to thank John Riedl, the organizer, for putting the conference together and inviting me for the keynote. I had the pleasure of meeting members of the core technical teams from Amazon, Yahoo!, YellowPages, and researchers from great technical schools like Carnegie Mellon and Stanford.

This conference delved deeply into the algorithms and science underlying ecommerce. There were talks ranging from combinatorial auctions, revenue optimization and game theory applied to ecommmerce. My talk, which can be found on SlideRocket here, was titled "Investing in Algorithms". Below is an excerpt from my abstract:

In 2008, the software market is rapidly evolving towards Software-as-a-Service
and Cloud computing, and away from the on-premise delivery model. In exploring
these new models we will see that this is more than a business or delivery model
phenomena affecting ecommerce - it is a shift that fundamentally changes
expectations of what software can accomplish. In this model data is king.
Algorithms and analytics become significantly more relevant as the data is now
housed in a central location.

The talk let me highlight several key areas of investment for Hummer Winblad through the lens of a few of our portfolio companies. Because I gave the presentation in SlideRocket I was able to show how SaaS drives new sources of data compared to on-premise solutions. During the presentation I pulled up the historical data of a previous presentation that I had emailed to a different group - and show how many times the presentation was viewed and which slides the audience spend the most time reviewing. Hard data to collect with PowerPoint!

I then talked about Baynote as an example where SaaS companies can use their own products as part of the sales cycle. Baynote requires only a few lines of code to be integrated to a customers site to be up and running. Data is then fed back to the Baynote SaaS application and quickly the recommendation/search results can be surfaced. Baynote quickly gathers A/B testing to show the uplift of revenue. If you attempt this type of solution on-premise there is a limit to the data that a vendor will see, and you have many steps (procure hardware, configure hardware, install software, integrate product, etc) before these uplift effects could be shown.

The last theme I touched on in my talk was the ability of SaaS to provide closed loop actionable analytics. I highlighted our companies Omniture and Signal Demand as examples where the SaaS vendors can both make recommendations and stick around to quantify the results.

Monday, July 07, 2008

Upcoming Talk on R

UPDATE - The slides from this presentation are now awailable here courtesy of SDForum.

For those of you interested in R - the open source analytics platform - I have copied an announcement for a great event in Palo Alto next week hosted by SDForum.

At Hummer Winblad, I have noticed that many of the companies we talk to and many of our portfolio companies are using R as a core technology in their product. It allows for developers to use statistical and data analysis tools without paying money to SAS or another vendor for each copy of their software. I think that we are seeing an increasing use of these type of tools with the SaaS model because in general the applications have more data available to them. For example, SaaS allows application vendors to also use analytics across their customer set to watch for usage trends.

Jim Porzak and Michael Driscoll will present...

A Gentle Introduction to R and its Applications in Business Intelligence

R, the open source environment for statistical computing and data analysis, has been adopted by over one million users worldwide since its V1.0 release in February, 2000. Although primarily used within academia, the life sciences, and financial engineering firms, R has promise in areas overlapping with "Business Intelligence."

Specifically, R is a powerful tool for marketing applications such as customer segmentation and cluster analysis, and can be used to achieve a better understanding of business data in general.

We will start with a brief history of R and its present areas of use.

We will then position R's functionality within the BI space and highlight its strengths compared to classical BI tools.

For the techies, we'll show R in action and discuss some of the language's powerful features. Most of the presentation, however, will be a series of brief case studies showing concrete uses of R in our respective practices. After the formal presentation, we invite interested R users to stay for a few minutes to discuss forming a local "Use R" group.


Jim Porzak

Jim is the Senior Director of Analytics at Responsys, Inc. in San Francisco. He has been doing Business Intelligence for the last 20 years, focusing on marketing applications for the last decade. He has actively used R, since 2002 and last presented R to the BI Sig in October, 2004. Next month Jim will give one of the dozen invited tutorials at useR 2008, in Dortmund, Germany - "Using R for Customer Segmentation" a sequel to his 2006 presentation in Vienna on Customer Intelligence.

Michael Driscoll

Michael is a Principal at Dataspora, Inc. a business analytics consultancy in San Francisco. He has a decade of experience using large-scale databases and data mining algorithms within industry, government, and academic institutions. He founded and since 2000 has served on the board of, an Inc. 500 e-commerce firm.

Michael has a Ph.D. in Bioinformatics & Systems Biology from Boston University, where he used R for the analysis and visualization of genome data.

6:30 PM - 9:00 PM July 15, 2008


Building D, Southern Cross Room

3410 Hillview Avenue

Palo Alto,, CA