Posts Tagged ‘Entrepreneurship’

Genealogy: A $1B Market? Maybe

Monday, March 1st, 2010

one_billion_dollarsI’ve spent a sizeable fraction of my evenings the past few weeks working on applications to summer startup accelerator programs. Genlighten’s to the point where we could really benefit from the mentoring, community, focused intensity, and access to seed-stage funding that these programs offer. The ones we’re particularly aiming at are:

The application questions reflect each program’s unique personality, but they also share some predictable common elements (What will your startup do? Who are your competitors? How do you plan to make money?) Though none of them specifically ask for revenue estimates (they’re smarter than that), they all imply that they’re looking for startups that are attacking large potential markets.

The Challenge of Sizing the Genealogy Market

That’s a problem for us. Just how big is the genealogy market? This question has been addressed in numerous forms over the years, usually phrased as “Just how popular is genealogy anyway?” Dick Eastman has taken a serious crack at answering this question in the past and arrived at the answer (paraphrasing slightly) “probably not as popular as we think.”

When I tell people I meet at startup-related events that I’m working on a genealogy website, they usually say something like “Oh… that sounds like a nice little niche.” Their body language sends the message that they don’t think I’m going to be getting rich anytime soon. I’m tempted to offer a response like “It’s actually a pretty big market,” but  I just don’t have the numbers to back that claim up.

My Estimate and How I Arrived At It

For the applications I’ve submitted so far, I’ve basically tossed out a made-up genealogy market size number: $1 billion in annual revenue. How did I come up with that number? Here’s my back-of-the-envelope calculation (all figures annual):

  • Ancestry.com 2009 revenue: $225M
  • All other genealogy websites: $100M
  • All other genealogy software: $50M
  • Professional genealogy services: $100M
  • FHL microfilm orders: $10M
  • Government archive film/document orders (NARA, State, County): $100M
  • Vitalchek: $50M
  • Other genealogical record retrieval (libraries, historical societies): $25M
  • Genealogy societies (membership, conferences,  transcriptions): $15M
  • Other genealogy merchandise (books, accessories, etc.): $25M
  • Specifically genealogy-related travel: $300M

Feel free to check my math, but I get that to add up to $1B annually.

Probing My Assumptions

Of the figures I’ve listed, only the Ancestry revenue number is anything other than a wild guess. The travel number is particularly suspect. I’m thinking about “pilgrimages to ancestral homelands” like Ireland, Germany or Poland, so they’re probably pretty expensive, but how many people are actually making those kinds of trips in this economy? And what about professional genealogists? Are they really making $100m in annual revenue, or is the real number more like $50M?

I feel a little more confident about the web and software company revenue figures, though they’re also probably a bit generous. But very few genealogy-related firms are public, so it’s always going to be difficult to refine these numbers without direct input from the leadership of these firms.

Does It Matter?

To the majority of family history enthusiasts, the size of the genealogy market probably isn’t that important. But if we’re going to encourage entrepreneurs to build innovative genealogy-related companies, and if those companies are going to receive the funding they need to grow and succeed, someone’s going to have to come up with a better estimate than I have. Hopefully a much bigger one!

Eternos: Preserving your Tweets, Facebook Photos, Gmail and RSS for Future Generations

Sunday, January 24th, 2010

Well, that didn’t take long.

A few weeks back, I posted about Bud Caddell’s idea for a Social Media Time Machine that would “Preserve and Curate My Social Media for Future Generations.” This weekend, I was followed on Twitter by a startup that looks like they’re trying to build exactly that. It’s called Eternos.

What Does Eternos Do?

From what I can tell right now, Eternos lets you backup your Tweets, your Facebook status updates and photos, your Gmail account and an RSS feed of your blog. You can browse through your  “artifacts” using a timeline format. If you’re not into social media, Eternos lets you upload and store standard content such as photos and videos. I’ve let it connect to my Twitter account, and that seems to work fine. It’s cool to be able to access the older tweets that Twitter.com typically won’t let you see. No luck syncing with Facebook yet though.

eternos_tweet_timelineHow Much?

It’s free during the beta period, and they’ll offer the usual “Freemium” pricing plan after that. That typically means that basic functionality will continue to be available for free, while a paid pro account will be needed to access the coolest features (including ones they’ll add over time.) Sounds reasonable to me.

Am I Excited?

I like what Eternos is doing… it seems like it’s got a lot of potential. Right now (as one would expect for a minimum viable product) it does the basic things it needs to do. They’ll iterate based on early customer feedback and add additional capabilities over time, I’m sure.

What I don’t see yet is the “Wow!” factor… the sense that they’re adding something uniquely valuable on top of the archiving function. In my post discussing this idea, I mentioned that I wanted to be able to look backwards in time and see relationships forming and evolving. Will Eternos tackle that? Are they developing some cool social media algorithms up there in Seattle? We’ll see!

Build Something For Yourself

Friday, January 22nd, 2010

I’m not a natural at networking. In fact, I find it pretty painful. But I know I need to do it, so I do. And sometimes it pays off.

Genlighten and “Getting Real”

jason_friedLast night I attended the Chicago Tech Meetup at OfficePort in Chicago. Jason Fried (of 37Signals fame) was the keynote speaker. Jason had plenty of cool stuff to say to the crowd of startup entrepreneurs, both the real ones (like Andrew Mason, founder of Groupon) and the simply aspirational (like me). Most of Jason’s advice was familiar to those in attendance who’d already read Getting Real, 37Signals’ manifesto on building a successful web application, or who follow Signal vs. Noise, their exemplary blog.

As Jason rattled off his key doctrines, I mentally checked off which of them Genlighten was adhering to:

  • Bootstrap… start building your product on the side while keeping your day job (check)
  • Charge for your product right away (check)
  • Don’t be afraid to hire non-local people and let them work remotely (check)
  • Don’t take VC money too early (check… though to be honest, we’ve never been offered any)

And then, in answer to an audience question, he said something like this:

Build something you would use yourself, whether or not anyone else ever does.

That one made me pause and ponder for a while. Does Genlighten fit that criterion? Jason was of course referring to Basecamp, the simple yet powerful project-management application that 37Signals built for itself before eventually selling it to others. But Genlighten isn’t like Basecamp.

The Chicken-Egg Problem

Here’s why. Basecamp was tremendously useful from day one. But Genlighten doesn’t start to be that useful until a certain amount of lookup providers sign up and offer their services. And to attract providers, we need clients, who in turn our unlikely to use the site if they don’t see lots of providers. That’s the Chicken-Egg problem. Or, putting a more optimistic spin on things, Genlighten gets better each time a new provider posts a new lookup offering. That’s an example of a Network Effect. Many startups have to climb this hill before they can really take off (think Facebook or Twitter) and we’re no exception.

Eating Our Own Dogfood

On the other hand, we do meet Jason’s criterion: Genlighten has already made my wife’s lookup business easier to manage, and we’ve both used Genlighten to further our own research. For example, we’ve ordered German translations from one of our providers, and Massachusetts death records from another. And with recently-joined providers now offering Maine and New York City lookups, we’ll be submitting more requests in the near future.

But sometimes, I find myself wishing I could just wave a magic wand and suddenly have providers for every county and country.

An Obituary for John Harper Reed

This brings me to this evening’s experience. I attended yet another startup-oriented meetup tonight, this one a casual get-together of Hacker News fans. As I made my way towards the long table set up for us in the back room at the Hop Haus in Chicago, I immediately recognized Harper Reed, the iconic former CTO of local startup success story Threadless. Harper is that rare web celebrity that lives up to his advance billing. I gratefully took a seat across the table from him.

We’ve talked briefly about Genlighten before, but this time Harper volunteered a query. Growing up, his parents had mentioned that he’d been named after an “uncle” from Colorado who had (so the story went) died in a car crash. Could Genlighten help him find out whether the story was true and how the two were really related?

As soon as I got home from the meetup, my wife and I went to work. A simple Ancestry search returned two Harper Reeds who died in Colorado. A USGenWeb site listed a John Harper Reed buried in an Evergreen cemetery in Colorado Springs, Colorado. To produce a quick happy dance, we’d need an obituary mentioning a car crash. The obvious sources did not immediately produce one online.

Could Genlighten help? Tonight, unfortunately, no. We don’t yet have any providers for Colorado. They’re out there, I’m sure, but we haven’t successfully recruited them yet.

You Can Help Us Leave Our “Chicken-and-Egg Problem” Behind

To fulfill Jason Fried’s mandate more completely, we’re going to have to work long and hard to build out our provider base. We’re trying to do that every single day. And we’d appreciate your help.

Please take a look at the states where we still have yet to recruit at least one provider. If you know someone in one of those states who knows their local records well, has the time and inclination to retrieve them, and is interested in getting paid to do so, please put them in contact with us. Especially if they can retrieve El Paso County Colorado obituaries. Thanks!

My Best Genealogy Moment of 2009

Sunday, January 3rd, 2010
The Harman Continuing Education Building on the BYU campus (photo by swilsonmc on Flickr)

The Harman Building (photo by swilsonmc on Flickr)

I’m a day late with my response to Randy Seaver’s weekly “Saturday Night Genealogy Fun” challenge. But when I saw that Thomas McEntee was too, I figured I’d go ahead and still be in good company.

My best genealogy moment of 2009 occurred as I sat at Genlighten’s exhibit booth at the BYU Conference on Computerized Family History and Genealogy back in March. It dawned on me suddenly that I had come full circle as a genealogy software vendor.

Twenty-six years before, I had attended one of the first versions of that same conference in the very same Caroline Hemenway Harman building on the BYU campus. Back then, as a newlywed sophomore majoring in Physics, I hoped to offer my first-generation Apple IIe-compatible Family Tree software (tentative title: “N-Gen”) for sale at the conference. But when I took one look at the competition, I knew I was completely out of my league. It was obvious to me that I didn’t know the first thing about marketing a useful product to the genealogy community. [Do I know any more now? I sure hope so!]

Now fast-forward to March of 2009: I’ve long since graduated from BYU, and I’m back at that same conference, once again surrounded by intimidating competitors, but this time as a reasonably legitimate vendor of a fledgling genealogy software product. Heady stuff. Scary, too. But I allowed myself to luxuriate in a rare moment of unabashed self-confidence. This time I would not go so quietly into the night of startup failure, I vowed softly.

The two times in my life I’ve launched entrepreneurial ventures, once as a twenty-something, and now again as a late forty-something, they’ve both had genealogy research at their core. It’s obviously got a powerful hold on me!

What (Genealogy) Startups Are Really Like

Monday, October 26th, 2009

Paul Graham of Y Combinator posted an enthralling essay yesterday entitled What Startups Are Really Like. As I seem to do whenever I read his essays, I feel somehow cleansed, purified and energized as a result of walking under his waterfall of great ideas. (Yeah, it really was that good.)

Paul emailed the startup founders he’s helped mentor and asked them what had surprised them about their respective journeys. He listed 19 key things they’ve learned. Nearly all of them resonated with me, so I thought I’d respond to each in turn based on my experiences with Genlighten.

1. Be Careful with Co-founders

Here the takeaways were  “[running a startup is] like you’re married [to your co-founders]” and “don’t pick co-founders who will flake.” I feel quite fortunate in this regard:

  • I’m already married to one of my co-founders — Genlighten’s “Chief Lookup Officer” — and the site is largely designed around her specifications for making the lookup process as simple and convenient as possible. I would never have undertaken a project like Genlighten without her as a partner.
  • My second co-founder, Justin Ball, has devoted countless night and weekend hours over the last year-and-a-half to get Genlighten built while somehow balancing a family of six, a freelance consulting business, and a passion for cycling at the same time.  He’s kind of the ideal embodiment of not flaking. By the way, thanks to Renee Zamora for introducing me to Justin.

2. Startups Take Over Your Life

This has definitely happened to me. Though I (thankfully) still have my day job, I spend pretty much every waking minute away from that job thinking about Genlighten and what we need to do to make it successful. As an example of this, I looked back at the emails in my inbox over the past week and all but eleven out of 132 are Genlighten-related. When friends ask the seemingly innocent question “So how’s Genlighten going?” I find I have to consciously shut myself up after a few minutes or I’ll just go on and on.

3. It’s an Emotional Roller-coaster

When a new provider posts a lookup on the site, or Google Analytics shows a sharp increase in visitors, or one of our users mentions us on Facebook or on their blog, I  immediately feel a huge surge of elation and optimism. Conversely, when an email we send out doesn’t yield the response we’d hoped for, or a potential client offers well-reasoned negative feedback, or delayed baggage causes me to miss most of a genealogy conference I was scheduled to exhibit at, discouragement can be just as dramatic. Like with a roller coaster, it’s the wild oscillations, rather than the peaks or valleys themselves, that are sometimes tough to stomach.

4. It Can Be Fun

I took a day off from my day job Friday to focus on developing some new marketing strategies and on getting our newsletter out. The day flew by in no time. I never once found myself wishing I could be doing something else instead. As Paul Graham says, “the highs are … very high.” Don’t get me wrong, my day job’s pretty good too, but it’s just not fun the way Genlighten is. Freedom and accountability are probably the main reasons for that.

5. Persistence Is the Key

Occasionally the thought will come to me “This is hard work. You don’t need to do this. Think how much more relaxed you’d be if you just gave up on this. You’re not cut out to make this succeed.” When that happens, I’m reminded of similarly ambitious goals I’ve had in the past (the optics Ph.D., the research grants I fought for when I taught college, the part-time Kellogg MBA) that took a long time to realize, but ultimately yielded to simple persistence.

6. Think Long-Term

Paul doesn’t mince words: “… everything takes longer than you expect.” Those of you who have been following our progress for a while may remember the flyers I handed out at FGS in Fort Wayne in August 2007. Giving myself what I thought was plenty of time, I predicted that our public beta would launch in March of 2008. I’ve had to revise that date six or seven times since (the flyers are now on version 23) and we just barely launched our private beta a few weeks ago.

Why has it taken so long? Partly because our finances have dictated that Genlighten is a nights and weekends project. Partly because we’re not single twenty-somethings who can pull all-nighters for a few months and have a minimum viable product. But mostly because we were (check that — I was) tremendously naive. Now I’m beginning to understand what one of Y Combinator’s more successful founders discovered:

“For the vast majority of startups that become successful, it’s going to be a really long journey, at least 3 years and probably 5+.”

It’s looking like that will prove a pretty accurate description of our journey as well.

7. Lots of Little Things

Paul notes that startup success is rarely the result of “a single brilliant hack” — a killer feature, if you will. We’ve found this to be true so far. A large portion of our design/development time has been devoted to incremental improvements/fixes: the links within notification emails, payment processing glitches, page titles, the location and wording of buttons, etc.

8. Start with Something Minimal

Part of the reason I’ve held off so long launching our private beta has been fear of embarrassment, plain and simple. Paul observes:

“Why do people take too long on the first version? Pride, mostly. They hate to release something that could be better. They worry what people will say about them. But you have to overcome this… Don’t worry what people will say. If your first version is so impressive that trolls don’t make fun of it, you waited too long to launch.”

We probably did wait too long.  But there are plenty of features we wanted in our initial release that we ultimately decided weren’t worth any further delays:

  • A slideshow-like page to help you browse through the images providers have uploaded to your account
  • The ability to export genealogy document images to Flickr, Picasa, Geni, Footnote, or Facebook
  • The ability for providers to rate and give feedback to clients (instead of just the other way around)
  • The ability to print out a receipt when you order a lookup
  • The ability for providers to print out a list of pending lookups to take with them to the repository

These things will come eventually, but we plan to get early users’ help in prioritizing these features before devoting lots of time to them.

9. Engage Users

Here the key idea is “product development [should be] a conversation with the user.” We’ve already gotten some great suggestions from those who’ve registered for our private beta, and we hope to receive lots more. One of the YC founders told Paul that:

“When you let customers tell you what they’re after, they will often reveal amazing details about what they find valuable as well what they’re willing to pay for.”

That’s a process we’re very much looking forward to.

10. Change Your Idea

Here’s an area where I can’t comment as easily from experience. We’re still very much focused on the original ideas we had for Genlighten (i.e., the features and the business model) though we’re definitely open to “course corrections.” One thing that could potentially change is the kind of provider we aim to serve. So far, we’ve envisioned our sweet spot as fixed-fee, document-specific lookups priced at about $5-$25 with quick turnaround, offered largely by “serious amateur genealogists” rather than professionals. But we’re already noticing providers signing up who want to advertise open-ended hourly research instead. We still think that market is better served by our competitors, and not one we really want to be in. But that philosophy could change.

11. Don’t Worry about Competitors

This is easy to say and very hard to do. I’ve felt a huge pit in my stomach every time I’ve learned of a new potential competitor to Genlighten. I’ve even found it difficult to visit their sites for fear ours would suffer in comparison.

Paul suggests that for many YC startups:

“Companies that seemed like competitors and threats at first glance usually never were when you really looked at it. Even if they were operating in the same area, they had a different goal.”

I’ve found this to be partially true, but of precious little comfort. One of our competitors has a well-thought out offering that targets true professionals and large-scale hourly research projects rather than lookups. They definitely have a different goal than we do and I’m not worried about them. But the 800-pound gorilla in our space is impossible to ignore, despite the difference in our goals. On the positive side, as I keep repeating to myself, competition is a sign that smart people see ours as a worthwhile market to be in.

12. It’s Hard to Get Users

For us this is doubly true, since we need to attract both clients and providers to our lookup marketplace, and the chicken-and-egg problem is in full force (not enough lookup providers => hard to attract lookup clients; not enough lookup clients => hard to attract lookup providers. ) Fortunately, we seem to be making some headway in this regard, and several promising avenues for both client and provider acquisition have recently opened up.

13. Expect the Worst with Deals

I recognized pretty much from the start that fundraising and most business-development efforts would be a complete waste of time for us until we had customer traction, so I’m completely in agreement with this point. Once we get to product-market fit, however, I know we’ll need to undertake these efforts. When we do, I’m prepared for them to proceed at an agonizingly slow pace.

14. Investors Are Clueless

I’m our only investor, so this definitely holds for us!  More to the point, VCs and angels I’ve mentioned Genlighten to so far have said smart rather than dumb things, e.g., “That market’s too small for me to get a significant return.” They’re right! However, I watched the judges at TechCrunch 2008 struggle to “get” what Footnote’s Pages were all about. If we ever decide to approach angel investors in a serious way, I’m sure we’ll face significant difficulties, even with customer traction.

15. You May Have to Play Games

I’ll admit that I don’t really get this one yet. I can’t imagine how “feigning certitude” would help us at all. Even if investors would even listen long enough for me to feign some.

16. Luck Is a Big Factor

My favorite quote in this section from Paul:

“Founders who fail quickly tend to blame themselves. Founders who succeed quickly don’t usually realize how lucky they were. It’s the ones in the middle who see how important luck is.”

We’re definitely in the middle.

17. The Value of Community

We haven’t had the privilege of being part of the YC experience or the Silicon Valley atmosphere that YC startups benefit from. But both the startup and genealogy communities have been tremendously supportive of our efforts, and we greatly appreciate that.

18. You Get No Respect

I’m instinctively aware of the extent to which “I run a genealogy web startup” would be a complete conversation killer among casual acquaintances. As a result, I rarely mention my involvement in Genlighten to those who don’t already know about us. (Except at our exhibit booth, that is!) This is obviously a problem, since job one for me right now is sales and marketing! So as a result of reading Paul’s essay, I’m going to work on saying “I work at a small startup you’ve never heard of called Genlighten.com” to anybody who will listen.

19. Things Change as You Grow

I’ll get back to you on this one when we have employees and reach “cruising altitude.”

The Super-Pattern

Paul’s summary conclusion is that

“As you go down the list, almost all the surprises are surprising in how much a startup differs from a job.”

This is only now beginning to become clear to me. Nothing in my undergraduate or graduate educations (with the exception of Yael Hochberg’s class at Kellogg) prepared me for the aspects of startup life that Paul outlines so succinctly in his essay.

GeneaTwits — A Twitter app for genealogists

Friday, January 2nd, 2009

Twitter logo

Randy Seaver posed the question yesterday on his blog:  Are any other genea-bloggers Twittering? One non-scientific indicator might be the number of new signups on the Twitter Family History Group, which has roughly doubled in size (from 20 to 40) since Randy’s post.  Or the number of tweets per day containing the word “genealogy”, which is about 28, according to Twitter Venn.  So it appears that the number of genealogists on Twitter is small but growing.

As Elizabeth O’Neal points out, that was true for Facebook as well “in the olden days” — i.e., early last year.  Could Twitter eventually grow to become a useful service for genealogists… the next trendy genealogy hangout spot on the web?  If so, then I have an idea to toss out to any similarly-inclined wannabe genealogy web entrepreneurs.

Suppose that all the genealogy enthusiasts out there in the Twitterverse — I’ll call them “genea-twits”, for lack of a better name — were to include the surnames they’re researching in their genealogy-related tweets, and use a special hashtag in front of them, say the ^ (caret) character.  For example, if I happened to make a noteworthy discovery on my Fillebrown line, I would put ^Fillebrown in my tweet celebrating that find.

Then, suppose someone were to build a web application which aggregated just the tweets in the Twitter-stream with those ^Surname hashtags.  The site could create a ranking of surnames and their popularity, offer a list of recommended genea-twits to follow, perhaps even allow for a simple form of social networking based around specific surnames, localities, or research techniques.  The result would be a site that aggregated real-time research efforts of genealogists across the globe, and connected them with all the immediacy and spontaneity of a 140-character Twitter post.

Imagine if you were at your nearby family history center cranking away on a microfilm reader, and you were struggling to parse a name on a microfilm image.  You could snap a picture using your iPhone and post a tweet with the image and the ^-tag for the related surname.  Fellow genea-twits could then look at your image and — in quasi-real-time — offer their insights and suggestions.

Or what if you were pounding away at census records on Ancestry at two in the morning, and had an idea about a connection you hadn’t considered before.  You could dash off a genea-tweet with your hypothesis, and let your “followers” who happened to also do genealogy at odd hours take a crack at it.

The model for this service would be StockTwits.com, a site that aggregates stock-related tweets using the $-hashtag (e.g., $AAPL, $GOOG, etc.)

Here at Genlighten, we’re too busy getting our own website up and running to devote serious time to building GeneaTwits.com.  But if someone else would like to tackle it, I’d be happy to offer advice and encouragement.  Heck, I’ll even spring for the domain name!