The Lull, through Grapevine, Maine and running

The “Lull,” reality or perception

This week, there is no central feature for Utterly Biased. Just a question.

What is your current perception of the Boston startup community, tech ecosystem, or whatever else you may want to call it?

Is it robust and thriving? Are there some incredible companies on the cusp of making national headlines or are there a whole lot of small wins that we are going to be seeing?

Or, as a few people have put it to me lately, is Boston in a lull?

For such a small word, “lull” packs quite an emotional kick. Webster’s defines it thusly: “a temporary pause or decline in activity,” and more specifically, “a temporary calm before or during a stormor “a temporary drop in business activity.” Whichever meaning you choose, it is not something you’d like associated with your business, and, it’s especially not the type of branding you’d want to saddle on an entire region’s innovation economy.

A slew of recent conversations I’ve been having with operators, founders, investors, and service providers have turned at some point to the theme that the Boston startup scene is eerily quiet at the moment.

Is this reality or just perception?

So, I ask you to send your thoughts my way. Is Boston in a downturn, or is this just the belief of a few. Is the ecosystem actually evolving as it should?

Send your thought to dennis@utterlybiased.com. I will publish some responses (you can request to have your opinion remain anonymous to the Utterly Biased readership.)

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Under-the-radar

This week, Dave Balter, a man who wears many hats, suggested a local company that he’s tight with that he believes isn’t getting the love it should. Balter singled out Grapevine, saying that the social media influencer marketing platform is “crushing it right now.”

Balter backed Grapevine through Boston Seed, and he is the head of its board of directors. According to Balter, who spends most of his time on his own venture Mylestone, Grapevine has really thrived since partnering with Chinese billionaire Bruno Wu’s Sun Seven Stars. That would make sense, Sun Seven Stars is an international private media and investment conglomerate that can help Grapevine take its social content monetization platform to a global market.

The market for connecting brands with social media influencers has been burgeoning as of late, but there have been two trends to keep an eye on. For one, YouTube, long the king of leveraging influencer marketing, especially with teens, has been seeing some blowback from major advertisers on how much control they have on the branded content that appears alongside their own advertising. While this doesn’t impact the influencers, per se, it is a signal to the marketplace, which has led some brands to look at YouTube alternatives like Snapchat and Instagram.

Second, Instagram has grown exponentially as a place for both branded content and influencer marketing.

Grapevine serves both platforms and should be able to whether changes in consumer tastes better than others in the space.

screen-shot-2017-02-22-at-4-00-23-pmWhat went down this week…

Maine – I met Kerry Gallivan, the CEO and founder of Chimani, a number of years ago at MIT’s VC conference. He looked a bit out of place hawking his outdoor adventure app, surrounded by three-piece suits and overly-eager to network aspiring venture capitalists. Maybe that’s why I was drawn to him and his story. That or the fact that here was this guy building a massive, aspirational project out of Portland, Maine — one of my favorite cities in the US — of all places.

Last year, Gallivan was listed in Outside Magazine as one of the “next pioneers” influencing the future of the America’s national parks. This week, Chimani announced a new product that should help it continue to dominate the national park tourist space.

  • The new Chimani Perks program is a membership savings club program for national park tourists. The program offers discounts on lodging, dining, activities, and more throughout the national park system, both inside the parks and in the neighboring gateway communities. Since its launch, Chimani — which has maps, content, and more for all 59 US national parks as well as those in the UK and Canada — has seen some rapid growth with more than 1.5 million downloads for its niche product. It customers aren’t the hardcore outdoor enthusiasts you might expect, but a large number of families, professionals, and retirees, what Gallivan called ‘windshield tourists’; a classification that makes up about 90 percent of national parks visitors according to the Chimani CEO. The number of active users each year is 750,000 according to Gallivan, and many of those use the park-specific apps to plan their trips rather than navigate them once they are there.  “Customers love our products, but we had to figure a way to make this business sustainable, which is the basis for this new Perks program,” Gallivan said. One thing is clear, its great to see some innovation happening in Portland and a good outdoor-focused business growing in New England.

FitRaceMenu, a platform for road race directors to manage, promote and grow their events, announced that it has sold off its race timing business to Second Wind Racing. RaceMenu, a stalwart of MassChallenge when it was at 1 Marina Park Drive, has quietly built a nice little business in the health and fitness space. Boston is actually a hub for these types of companies with Runkeeper, Inside Tracker, Spartan Races, Tracksmith, and more playing a major role in the active lifestyle and athlete industry.

I spoke with RaceMenu’s J. Alain Ferry, RaceMenu’s founder about the sale and how he is positioning the company moving forward. His response, “It may sound nuts, but it’s to compete against Square and Paypal.” He added that RaceMenu is “playing the long game.” Here’s more from Ferry, who seems to have figured out a way to actually bring innovation to the racing circuit:

  • “As of last week’s sale, we are singularly focused on software, and more specifically mobile payments. The endurance events industry offers a unique (and incredibly lucrative) opportunity for mobile payments. Ever wonder why every half/full marathon and large 5K under the sun has a pre-race expo but no post-race expo? The supply and demand are still there after the race, and even more so in many cases. But there’s no currency, nor will there be anytime soon. While increasing numbers of people run with their phone, that doesn’t really help all the merchants who want to sell to post-race “runners high” consumers. They’re willing to pay for better food, beer, race merchandise, running clothing, running shoes, massages, GPS watches, other race entries, etc. But how do they pay? There’s one thing which every single runner has on them after the race which can help. It’s their race bib. Timing companies use the race bib to identify the runner for scoring purposes. If you can connect their race bib to the credit card they used when registering online, you can also use the race bib for payments. Now you add this currency to an equation where supply and demand already existed and BOOM: you have a new market.”

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Investing in a few key startups alone won’t save struggling American cities

Beyond Boston

Earlier this week, it was announced that Steve Case, AOL founder and chairman and CEO of Revolution LLC, would be bringing JD Vance into Revolution in a special role.

Vance, a principal at Mithril Capital Management, is best known as the author of Hillbilly Elegy, a highly-regarded account of life growing up in the Rust Belt.

The move to add Vance, who will reportedly “focus on the firm’s initiative to identify and back infant companies in cities far from the tech capital of Silicon Valley,” aligns with Case’s current thesis about where innovation can be found. Basically, Case believes that the non-traditional tech towns —Detroit, Cleveland, etc. — are where the most impactful next generation companies will be found; this is something he touches on in all his public appearances as well as in his book, The Third Wave.

Supporting non-traditional tech centers can have two outcomes. One, an investor could find the proverbial “diamond in the rough” startup that has less overhead and greater long-term potential — think Shinola in Detroit (image above) or Zappos in Las Vegas. Second, is the other, more meaningful impact that supporting startups in places like St. Louis, Austin, Milwaukee, and others, could have.

The reason Vance’s book has garnered so much attention has been the focus, after the election of Donald Trump, on how to support these struggling — and often ignored — working class communities across America. People like Steve Case and others believe investing in a few companies in these cities could turn around the downward spiral caused by the loss of manufacturing jobs.

Well that is all well in good in theory, the reality is a bit more nuanced.

If the focus is on building more startup-centric communities, investment in the top tier companies in these locales sounds like a positive shift, but from folks I’ve talked to who are working on projects to support entrepreneurship outside of New York, Boston, and Silicon Valley, that approach is a bit short-sighted. While finding — and supporting — a few winners in places like Baltimore and Cleveland could start a chain-reaction of innovation, the argument is that to create more employment and more opportunities in these developing clusters it takes a wider community of startups.

Which is why CIC St. Louis and whatever new initiatives MassChallenge is quietly undertaking could be better and more meaningful in the long run to helping solve the issues Case and Vance seem to be targeting.

Arguments have been made that it is not worthwhile to build a company outside of Silicon Valley (and New York/Boston to a lesser degree). This argument is built off the idea that only established tech and innovation clusters can be beneficial to founders and growing companies. Which is exactly why Tim Rowe’s CIC expansion and Scott Bailey’s stealthy work to grow MassChallenge’s programs in North America are so necessary. It will not be by the establishment of “pillar” companies alone that will make or break the next wave of growth in non-traditional innovation centers, but by the creation of thriving and supportive communities.

Beyond programs and investment, another opportunity rests with the initiative of a few individuals to bring what I’ll call “grassroots” innovation community building to non-traditional areas. A great example of this would be what the former leadership of Dyn, and, more specifically, what Jeremy Hitchcock and Grey Chynoweth are trying to do to support entrepreneurship in Manchester.

Closer to Boston, another example of this is Ben Pleat, a Harvard student and the founder of a community building startup Doorbell, wrote a long treatise about why he is working with Worcester to jointly test his company’s product and support innovation as that city tries to shift from its working class roots to a more innovation-fueled economy.

As Pleat puts it, “Worcester presents not only an exciting city expansion for our real estate technology startup based in Boston, but also an opportunity to work directly with some of the largest stakeholders in the city’s urban revitalization initiative, ranging from local business owners to energized political leaders looking to transform the Downtown landscape.”

The success of all these initiatives is vital to the continued growth of the US economy, especially in the Rust Belt and former manufacturing centers. However, there are two competing lines of reason on how to do that. There is the Steve Case model of investing in a few potential winners and hoping that there is a trickle down effect. Or, there is the community building and municipal partnership approach that the CIC, MassChallenge, and others are taking.

After observing both the CIC and MassChallenge‘s impact on Boston as well as the potential that individuals can have to make change on a city-wide scale, I’m not so sure if the “spray and pray” method favored by investors is the best way to impact change where it is most needed.

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Under-the-radar

This week, I reached out to Peter Boyce II, VC at General Catalyst and the co-founder of Rough Draft Ventures to find out who he thought wasn’t getting enough love.

The company he pointed me to is LogRocket, a “customer experience platform that helps companies build better online experiences for their users.”

Co-founded by recent MIT and Columbia graduates, LogRocket enables development teams to playback user sessions to identify any issues and bugs that are causing problems with applications.

“They’re testament to what talented young technical founders can build here in Boston as a solution for enterprises and SMBs,” Boyce said. “They are focused on product and helping more of their community go deeper in understanding how UX and software decisions influence impact their businesses.”

All the while, Boyce added, LogRocket is “Quietly learning and building.”

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What went down this week…

Bi-Coastal – Matt Brand is one of the top startup tech guys in Boston. After making his bones at Tabblo, the photo printing company founded by Antonio Rodriguez and acquired by HP, he has gone on to play an integral role in various other local startups. Most notably, he was the tech head (and often the lone leadership in Matt Lauzon’s absence) for Dunwello. Now, Brand has a new gig as the CTO of MoveWith, an active lifestyle application that is based in Boston and San Francisco.

  • According to Brand, MoveWith recently launched audio classes in addition to its in person classes in Boston and San Francisco. “Teachers love it because it allows them to spread their brand and skills far beyond their physical studios while still being able to offer in person classes and connect with their students,” Brand said. “And the rest of us get a way to workout how/when/where we want with great teachers from all over the place.”From what I gathered, Brand is really enjoying his new gig. “What I think is cool and different from a lot of the other players in the space,” he said, “is that we’re not just yoga or just meditation or just running.”