Here is a wildly embarrassing video about how I hustled my way into Red Hat. I recommend starting at the 3min 15seconds mark to watch the blooper reel. It has the best bits. Enjoy!
They say great entrepreneurs have grit and hustle. I’m not sure if I am a great entrepreneur but I have been known to have moments of hustle.
One such moment was in 1999. Back then, I was a second year MBA student at the University of North Carolina, focused on technology / marketing / entrepreneurship. I have always been entrepreneurially minded but I figured that I should go work for a software company for a little bit before starting out on my own.
It was frothy back in the Dot Com Boom days. There were lots of startups to go work for. But, I found few that were truly interesting and innovative. In my search, I stumbled upon a little company called Red Hat and was intrigued. It was based in Durham and still very small, less than a 100 people. More importantly, I found its open source model and community fascinating. I believed that it was truly going to change how software was developed and deployed. Back then, Red Hat was rough around the edges but I could see that there was a diamond in there. I had seen this diamond in the rough before so I knew what to look for.
I graduated from college in 1993. As a computer science major, I had been fairly tied into the pre-Web Internet and even ran a Bulletin Board System (BBS) as a kid. But, I took a detour after graduation and joined the Peace Corps. By the time the “World Wide Web” burst on the scene in late 1993 and 1994, I was living on a remote island with no connectivity. My days were filled with teaching and coconuts instead of coding and startups. (Which was awesome btw!) I missed the Web’s grand entrance but deeply understood what it looked like before becoming mainstream. I saw the same thing with Open Source in 1998 and 1999. Fortunately for me, I was near its epicenter and determined not to miss out on it again.
I wanted into Red Hat but I needed to get their attention. So, I recruited my business school friends to help me make a video, stating my case. I pressed the video onto a CD-ROM and FedEx-ed to the CEO. Easy to do now but no so easy in 1999.
It worked! (in addition to a few other tactics like organizing a school-wide presentation for the CEO and telephoning the head of marketing every week.) I joined as an intern and then converted to a full-time employee around graduation. Meanwhile, I let my more lucrative offers at places like Dell Computer expire. Red Hat IPO-ed on scant revenue later than summer and managed to survive the Dot Com Bust to become the $15 billion 10,000-employee gorilla that it is today.
Some of that $15 billion is likely because of the awesomeness of this video.
To follow-up on last week’s security post, Email Service Providers like Bronto need be vigilant about security and act like the banks of the new millennium — banks of personal information with email addresses increasingly being the new currency. Of course, if you walk through city streets with your wallet hanging out, a secure bank is not going to help you very much. Here are some thoughts on what you can do to keep your email and customer lists more secure:
- Think about what you are storing. Customers’ contact lists often contain much more than email addresses. Be aware of what data you are storing on whatever email marketing platform you are using — in particular, avoid including very sensitive pieces of data like credit card numbers and social security numbers for your contacts.
- Protect and rotate your password. Most intrusions happen through the first door versus technical back doors. Your password is often the front door key so it is best to have a “strong” password and change it periodically. Strike the balance of it not being so hard to remember that you have to scribble it on a sticky note that sits on your desk. That’s not secure either.
- Control access. Every account at Bronto includes multiple users — use them. And, when some one no longer needs access, delete it. Shared user accounts and passwords are inherently insecure and a cause for break-ins.
This is all common sense that sadly isn’t common enough. Bronto has a full suite of security features to make these type of things easy to do. Read this post on Brontoversity to learn how.
Phishing and Key Logging
Now, here’s the tricky one that you probably didn’t think of but has been the reason behind some recent data thefts. This really happens so read this one carefully.
The intruder sends you a phishing email trying to lure you into downloading a computer virus. The virus is a key logger. The key logger runs in the background and secretly logs and sends every key to the intruder. Then the intruder simply listens for your username and password and then tries the combination themselves. Https and other secure connections won’t help you here because your typing is captured before your information is encrypted and sent along to connected website. Then the intruder goes in through the “front door” by signing into your account with your username and password and takes what they would like.
In addition to the suggestions above, I recommend the following to mitigate the risk from phishing / key logging break-ins:
- Be aware of phishing emails and what you download from them.
- Install and maintain current anti-virus software. Anti-virus software will monitor your system for common key loggers.
- Limit the IP addresses that can access your account to your office’s IP address. Will this be inconvenient when you try to sign into your account from home or on the road? Yes but a secure office would have a VPN to let you securely access the Internet through your work network. Read the Network Access section of this post to learn about how to do this in Bronto.
Ultimately secure data is a journey and not a destination — you are never a 100% there and the effort to keep your data secure never ends. But, there is a lot in your control to make your data more secure and exponentially more difficult to steal.
Willie Sutton was a famous bank robber from the first half of the twentieth century. One time a reporter asked him, “why do you rob banks?” His now famous response was, “because that’s where the money is.” The new money these days is personally identifiable information — email addresses and related bits — and Email Service Providers like Bronto are the new banks.
Today this reality became thrust into the forefront with Epsilon reporting that they had a major security breach that resulted in stolen email lists from many top brands including Best Buy, Capital One and Disney. Read more from the article in Security Week.
This is an unfortunate issue and reinforces why we take security and privacy very seriously at Bronto. We’ve invested much effort in the past 15 months into improving not only our own technology and internal security stance, but also providing many features to customers to allow them configure their own security controls according to their preferences. Among the areas we’ve improved during this time are our network, our internal management applications, and our internal policies and training. Additionally we’ve also improved our ability to detect and monitor activities going on inside our application and network, so appropriate staff are alerted to investigate, 24×7. On the customer side, we have added new features in the areas of account management, password security, user permissions, & API security. The security of your data is of the utmost importance to Bronto, and we never forget that.
We understand that we are a twenty-first century bank and the vault of your data is extremely valuable and needs to be kept very secure.
Unfortunately, with incidents like this, no one wins and the only redeeming value is that it sends a strong message to everyone in the industry that their security, whatever it is, could be better and forces them to re-assess and improve. We will certainly be re-assessing ours and looking for improvements. And we welcome conversation with anyone in the industry regarding how all of us can tighten security and provide a more secure world for all.
Ok — this isn’t true. But, here are some thoughts on why this could make sense:
- Intuit is focused on small businesses with a financial bent (think TurboTax, Quicken).
- Constant Contact is focused on micro/small businesses but from the marketing side.
- Constant Contact is dipping into the SMB payment side with their event marketing / registration product. This is a good intersecting product for the two companies.
- Intuit has a history of doing acquisitions, although this would be much bigger than most. Think Mint, Homestead, MyCorporation, …
- Intuit has a history of running their acquisitions as distinct sub-brands versus rolling them into a uber-platform. This would be very important in realizing value of something like CTCT (or like competitor) given the fickle nature of their customer base. Someone one described to me that the micro-business customers that make up the bulk of CTCT’s customer base have almost a symbiotic relationship with the product. Alter it a lot, like what would happen if it were redesigned to fit into someone else’s platform, then there would be significant churn.
Here are thoughts on the valuation:
- Intuit (INTU) has a market cap of $9b. Constant Contact (CTCT) has a market cap of $500mm.
- I put a 40% premium on the deal from their public market cap. Omniture had a 45% premium, which is rich but not unrealistic.
- The revenue multiples make sense. CTCT did about $130mm last year. They have about $50mm in cash. So, 700 – 50 is 650. Divided by 130 makes it 5. A valuation at a 5x revenue multiple would be consistent with other acquisitions.
Of course, Intuit could buy a smaller competitor like iContact or Vertical Response, but my gut tells me that they would step up to the plate with a good mix of cash and stock (Intuit has about $1b in the bank) to make a solid stake in this area versus opt for something less.
You heard it here first. If it ends up happening then the investment bankers can send me some of that multi-million dollar fee. Thanks.
Things often have a way of coming full circle. Back in May 2002, Bronto purchased its first server to host its email marketing application. The server, originally named bronto, was built by Blake Watters, a freshman at UNC Chapel Hill, for about $1000. It was a big purchase back in the day.
What a long strange trip its been. Now, we are many servers, people and sophistication away from those early days. But, sometimes it’s valuable to dust off the old, and make it new. Just like Seabiscuit, the old server found a new life — hosting this blog.
Before our domain bronto.com, there was brontomail.com. And, little known, prior to brontomail.com, there was joeism.com. Now, the first domain and first server back together again. All is well in world!
Thanks Doug for setting the server up and Blake for building it originally (where ever you are!)
Recently I’ve been thinking about how online marketing applies to video, in particular to how television shows and movies are delivered over the Internet. Of course, when delving into this area, you have to look at how video is being distributed illegally — the dark world of file sharing. This world is often a harbinger for what is going to work and not work as the Internet becomes the primary distribution vehicle for movies and television shows.
My experiences watching the popular television show Lost maps nicely to some of the new ways of watching video. Here is how it played out over the last few seasons:
- Season 1. I watched the first season on DVDs from NetFlix. This is my favorite way to watch television since you get multiple episodes at once, the quality is great, and it is convenient.
- Season 2. I subscribed to iTunes and the week’s latest episodes downloaded right to my desktop. It was automatic and very convenient. I paid thirty some dollars for the season and it worked out to be $2 an episode. Unlike most people, I don’t have a television to watch this on and, even if I did, I would have to tape/tivo it because I’m often still putting my kids to sleep when it comes on.
- Season 3. This year I went to a neighbor’s house for the first two episodes. But, for the other day, I wasn’t able to do so I had to get the episode some other way.
With my test, I downloaded the episode through iTunes and through Bittorrent. Here are my thoughts on the pros and cons of each:
- iTunes. Cost me $2. Extremely easy since billing already setup through iTunes. Good quality. Took 25 minutes to download.
- Bittorrent. Cost me nothing. More involved but getting easier with rise of rss bittorrent services. Good quality but some risk of it being not quite right. Took 3 hours to download.
In the end, iTunes was better. $2 is a small price to pay for a better experience and piece of mind that the content was obtained and the relevant parties are being fairly compensated. However, iTunes works best in this case because the content is readily available. This isn’t always the case. Take one look at the movie selection from iTunes of Netflix’s on-demand offering and you’ll see what I mean. This is what makes downloading illegal content tempting for so many. Although it is still more challenging and not quite as easy as Napster used to be, it is getting easier and only a few steps away from being easy enough for regular people.
Thus the challenge — the longer that the movie houses struggle over the right solution for distributing video online the more time that illicit services have to rise and improve. Take a quick peek at my searches for Lost on YouTorrent and tvRSS and you’ll see what I mean. It is getting more and more approachable.
As for me, next week I’ll probably be back to watching to Lost at my neighbor’s house with a bowl of popcorn but perhaps by the time season 4 rolls around I’ll buy a real TV and hook it up to a new fangled Apple TV or Netflix appliance. We’ll see!
I have been using RSS feeds for a couple years now and really find them handy for skimming through lots of news articles very quickly. Until now, I always added them as “Live Bookmarks” in Firefox. It worked well and was a convenient way to juggle about 10 different feeds.
Today my feed world changed in two ways:
* I installed NetNewsWire. It is a program for the Mac designed for reading and aggregating a whole mess of feeds. I tried the free Lite version but it was too limiting. Most likely, I’ll fork over $30 after my 30-day trial for the full version. These type of feed readers remind of the newsgroup readers of yearyear. I never got into those so we’ll see if this one sticks.
* I added FeedBurner to this blog. I host this blog through Typepad and there was a fairly seamless tie-in. From what I understand, FeedBurner layers on top of any feed and provides an easy way to do basic tracking on visitors among other things. FeedBurner seems to be in vogue these days so at the very least I’ll be on the cool side of the blogsphere.
If you have any thoughts on the merits of either product, let me know. I’d love to know.