Wednesday, September 17, 2008

Are we done yet - part 2

Early this year, I wrote a blog article titled "Are we done yet" where I created a rolling snapshot from East to west of some major market indices.

Well today I am attaching a table of the same markets and their closing value on the first day of the year and their current value (as of yesterday). Check it out. I did this as there was some dodo-bird on CNBC yesterday saying that investors should look elsewhere in such times. I looked and found none. There may still be individual plays such as gold and other precious metals left.

Table 1: Select Major Market indexes

China is the one market taking the hardest hit followed by Hong Kong and India. In fact the US markets (DJIA and NASDAQ) have fallen the least from the beginning of the year. Note, If you had bought Gold at the beginning of the year and held it until now, you would have made about 3.35% gain. If you bought it last week you would have made 8.5% by now.

Until all the banks throw open their books and mark down all the values of their sub-prime gunk, we will continue this roller coaster as more and more reveal their liabilities on the day of their demise.

Knowledge and Leverage is key to any Negotiation

I sat down at the table after the presentation was done. The meeting continued as our team and the excited client were now discussing actual steps of engagement. The deal was not done but they were going to try our product based on some of the feedback they had been getting from other new customers. Suddenly, the conference room door swung open and in walked the divisional head of the group. He just stood there for a second and stared down at all of us. He took a seat and flipped through a copy of the printed presentation slides. His next words and actions are something that I will never forget for the rest of my life. With his hands thumping on the table he announced in a loud voice, "Why would I want to buy this new product from a new startup when my teams have a working solution. I do not want my teams to invest their time or money learning new products. This is a waste of time". With that he got up, tossed the slides onto the table and walked out. (Keyword: Leverage)

It was a cold february afternoon in Ottawa (Hint). On the way to the airport, I was kind of disappointed about what had happened, but was reassured by the design manager of the client that he would revisit this with the divisional head soon. We did not hear from them for a while. We went about our business and were quite successful with a lot of other companies.

Many months earlier I had joined a new software company as an applications engineering manager. This new company was embarking upon delivering some ground breaking verification technology to the semiconductor design companies. The new technology had been developed in anticipation of the emerging seismic technology shifts and was built to handle the various complex technological changes in the entire design flow. Some of these design flow changes would basically force existing applications to rapidly scaleup to handle larger amounts of data. We were certain that existing applications could not handle these changes and would fail. We had worked with many of the vendors who were in this design eosystem and had the foresight to accomodate for this. (Keyword: Knowledge) Many of the design companies would encounter this as they shifted their flows to design the next generation of integrated circuits. The company in question above would have roughly about three months before this hit them. Of course we had told them about it in the presentation and the team was buying it until the Divisional head had waved us off.

In late August of the same year, we got that call from the manager at the client site. Their existing tools were failing and unable to verify the next generation designs. We went in and in less then half a business day had all (I repeat all) their new designs loaded up in our tools and verified. We were verifying the integrity of the designs faster and with much lesser memory than any of their existing solutions. To top it all, we were the only solution capable of actually completing the designs. In fact they were so bewildered by the speed of our technology that they acutually inserted deliberate flaws into the designs to ensure that we would catch them. And catch we did, everyone of them.

A few days later, I got a call from the VP of sales of our company. He was calling to ask me about my email to him regarding the No-Discount to this particular client. As a startup we were accustomed to handing out generous discounts to many companies just to get some revenues in our first year (FYI: Our software list price was around $ 150K). I basically told him that given the clients arrogance and the fact that they gave up their leverage, meaning that they were basically screwed without us, that I would not offer a single percent discount even if it meant a potential loss of sale. I mean in simple terms, we were their only option period. We had them by their balls. Why the heck would we negotiate down or even offer a discount. Long story short, they are the only customer that I know of who paid full list price on nearly 6 copies of the tool and with maintenace and support thrown in, it was well over $ 1.2M when the deal was closed.

The two keywords here are Knowledge and Leverage. Know what is your customers' pain not just for today, but for what's on the horizon. Educate your field marketing, sales and application engineers to keep a eye and an ear out for information that may help you negotiate better terms. Hot heads who some company insiders consider as god (because they usually speak in a loud voice) must be kept away from customers or even let go. This is simply because their ability to supposedly keep a well oiled machine on the inside may be compromised by the fact that they are not able to handle the same on the outside.

Sunday, September 14, 2008

A Mighty Ping Pong Palooza

I had the opportunity to participate in a Ping Pong Matchup organized by Howard Lindzon. The event was sponsored by BuddyMedia and held at the Wang Chen's Table Tennis Club (250 W 100th St) on the upper west side of Manhattan. However I must say the place looked more like a Wang Chen's dungeon. The basement area where the ping pong palooza was held was steamy hot. I had to be careful to keep myself hydrated as you did not have to do much to start sweating in that cramped arena. Mike and Kass Lazerow (CEO and COO of BuddyMedia) had pulled together some great refreshments for the participants.

I must say that I made it to the final 16 only to be bested by Ben Kartzman, CEO of Spongecell. He ultimately went on to win the paloozathon beating Nate Westheimer. I ran into Aaron Task 0f Yahoo tech ticker fame at the event.

Post palooza celebrations were at "The Abbey Pub" on 237 W 105th st. I also did meet some old friends Wayne and made some new friends Vishy, Adarsh, Timothy Sykes, Patrick Courtney, Scott, ozsultan, Brian, Leora and more. You can find some pictures here. I had a great time and the event was great for networking.

In the end I did get something - a Tshirt from Spiritual Gangster, a clothing company based out of Scottsdale Arizona.

Friday, September 5, 2008

A divergence of sorts

Well time for a quick update.

I have been hard at work with JP and RB over the last few weeks. It seems that we may have some help finally on the Blackberry front. Very shortly we will have our software on the desktop, the Windows Mobile, the Blackberry and the iPhone platforms.

Well this update is not really about all that. I am writing this post just to update some of the readers that I will be now separating my personal blog from my professional blog. Meaning this blog will become my personal rant space. I will write here about things that I know about or things that I want to know about or something like that. Here I will also write about my personal experiences of this past year. I call it my entrepreneurial sabbatical. Don't get me wrong. Its no sabbatical. But it certainly was a welcome change from the previous industry that I was in. Going up to my Boss and saying I am resigning was hard. I had a comfy job, a great salary, good perks and all. I knew the ins and outs of the industry and the entire eco-system. But I was ready for a change and I had to get out of it. Now I am so excited to be doing the things that I have been doing over the last few months. Its been a process of discovery. Discovery of the new, the unknown and also unique ideas of how to link the new to the old.

I am moving over my technology and work related discussions to my blog on You can visit that site to learn more about our product and our future direction with MOBOW, our startup.

Good Luck. Follow me here for my rants about this and that and all things relevant.