Friday, May 27, 2011

10 Things Not To Do In Your Social Sharing | Polyvore Shares Lessons Learned

Earlier this week I went to an event at Hacker Dojo, a coworking space in the heart of Mountain View. It was my first event there, and while I had certainly heard the name before, on more than one occasions, embarrassingly enough I did not know it was a coworking space. So anyway, that was exciting!

The presentation, by Jonathan Trevor of Polyvore, a social commerce company with some 10 million unique visitors per month, goes to the heart of the big, burning question at the heart of every (internet) startup: how do I use social media to get consumer eye balls on your product and, ultimately, traction?

There are many things you can do wrong in this area, which is a science (or perhaps an art) evolving right before our very eyes. In his presentation, Jonathan walked us through some of the common misconceptions about social media as a tool, using examples from Polyvore's own experience. You can find the slide deck for his presentation posted here, but for a more narrated version, keep reading.

Misconception 1: I know what's going on

Never assume that you understand the way social sharing is working or that it is working the way that you think it is. You might think Facebook is the way to attract the most users via social sharing. Or Twitter? Jonathan was surprised to find StumbleUpon to be one of the better organic disseminators. StumbleUpon? I know, I haven't used it either, but apparently it's big, in the right circles.

Measure, instrument and iterate to try and get a better picture of what's going on. You can use Google Analytics, or collect your own data and run SQL queries, whatever suits your fancy. The better that you are at measuring, instrumenting and iterating, the better, more effective, product design you will have.

Don't limit yourself to measuring on your own site. To the extent possible, try to do this on third party sites as well. There are even applications for that, like (love the name!).

Misconception 2: I'll focus on the CTR on my site

While CTR (click-through rate) is obviously important on its own, it's even more important as part of a larger social sharing loop. Getting people to "like" your page is not enough, if it is not bringing return traffic to your site.

Once one of your users clicks the Facebook "like" button, or posts content generated on your site to Tumblr, or tweets one of your pages, who sees that content? How many of those who see it are interested enough to follow the link to your website? How many of those who follow the link to your website become a user? This may seem like an obvious point, but it's easy to get caught up in improving CTR on your site, losing sight of the big picture.

Misconception 3: Users want to share

Sure, users want to share, but not all the time. They are inundated in their web browsing experience with all kinds of social sharing buttons, so much so that they've become little more than noise.

What's important in getting people to shares is to align intent with, well, sharing... To use Polyvore as an example, when their users browse sets by other users, maybe they'll "like" those, but there is not an impetus to share. On the other hand, when users create their own sets, sets that they've spent time on and take pride in (hopefully) they want to scream about it from the rooftops. The breakdown of sharing between their set viewers and set creators is 25% to 75%, which is staggering considering how many viewers there are and how many fewer users are creating sets. And it's a good example of how powerful it is to align users' intent with your own.

Misconception 4: One size fits all

There are different kinds of users that you need to think about as you are designing your website.

Bloggers don't share as often (and certainly when it comes to the same service), and they will have a bias against sharing something that already exists (old news). If they can create something original with your product, they are more likely to share it. There is a way to optimize your website for bloggers.

Social sharers, on the other hand, share often and freely. If it's easy to do (e.g., no login required, one-click), they'll do it. There is a way to optimize your website for social sharers, and that's going to look different than a website optimized for bloggers.

One size does not fit all.

Misconception 5: All shares are equal

Not all social shares are equally valuable. Shares on Facebook and Twitter, in theory at least, reach a lot of people, those the viewership may actually be quite small. The environment is noisy. And the content there is short-lived. Perhaps most-importantly, though, it is a low match to reader interest.

When bloggers write about your site, it adds SEO value. There are fewer bloggers than social sharers, but the content is richer and last longer. Finally, there is a much better correllation to reader interest.

Misconception 6: Users can read

Well, maybe users can read, but they don't and they won't.

Polyvore ran tests where they manipulated the amount of text on the same dialog, leaving the pictures and graphics intact. They found that changing or even removing the text altogether had no impact on the users' choices in the dialog.

Misconception 7: Wizards are better than complex forms

We might think wizards are better than complex forms because we know that complex forms are bad. But really, they are both bad. If you can, simplify a complex form into a simple one, instead of breaking it up into a wizard.

Keep in mind that every time there is a new dialog box with a cancel option, you are going to lose users. It's just too easy!

Misconception 8: More networks is better

There is a lot of overlap between networks. And placing 50 buttons on your site just creates noise and clutter. A user doesn't want to sift through all those buttons to find the networks she wants to share on. So how many networks do you really need to get 90% coverage? Maybe up to three? More than that is probably too many.

Misconception 9: Make complex simple ... by hiding

For whatever reason, I think this is my favorite point of the presentation. Simplifying by hiding really works, said Jonathan. If you hide options behind tabs or "advanced" links, users won't find them. So rather than be clever and hide additional features, consider whether you need them in the first place. If you do, find a way to integrate in a simple and graceful way.

Misconception 10: That there are 10 misconceptions

And so we come full circle to where we started: this is an evolving field, where new discoveries are made every day and negated the next and where no truism stays true for long. It is up to today's entrepreneurs to redefine all the conventions of web design and user experience. And I can't wait to see what you come up with!

Inna Efimchik

Emergence Law Group  Emergence Law Group, specializing in assisting emerging technology companies in Silicon Valley and beyond, provides incorporation, financing, and licensing services as well as general corporate counseling.

Tuesday, May 10, 2011

Runway Program by Innovation Endeavors | Giving Entrepreneurs Runway to Launch Their Next Big Company

Undeniably, being in the Silicon Valley gives technology startups a huge boost. This is the place that has amassed the most talent, the most VC dollars, and the best ecosystem for launching. Whatever else may be said for its ridiculously high cost of living (and cost of labor), employer-unfriendly laws, and, take your pick, nasty traffic or seismic uncertainty, I doubt there is another place that can boast so many startup incubators, accelerators, and coworking spaces as the San Francisco Bay Area. The links page on my website features 14 different organizations in this category, and I am sure it is not exhaustive. (In fact, if you are aware of anything I've omitted, please let me know.)

Yesterday, I met for coffee with Corey Ford, Director of Runway Program, a paid six-month entrepreneurship program based out of Innovation Endeavors, to learn more about their project. Here's what I learned.


Runway is pre-team, pre-idea. You should consider applying if you are (1) entrepreneurially-inclined and think you have the skills, whether on the technical, business or design side, to be an entrepreneur, (2) are willing to commit at least 6 months, full time, to building a company in Palo Alto, (3) are interested in a collaborative process to identify a problem and develop a solution that is a viable business opportunity. (You should also be authorized to work in the United States for any employer.)

Runway is not for entrepreneurs who already have a business solution they are committed to and are just looking for cofounders. It is also not an ideal fit for established teams, as the application process is for individuals and considers each applicant individually (though established teams may apply individually and indicate a preference to work together).


If you are itching to start a company and fit the criterial above, you can submit an application to the program. Applications for the August program will only be accepted for another couple of weeks (deadline is May 23, 2011). There is no cost to apply.

Each application will be individually reviewed filtered on values and on disciplines. Some of the applicants will then be selected to do a mini-project, to test their entrepreneurial skills, followed by interviews. The finalists (less than 20 in all) will meet at a Final Team Weekend and will work on small group projects, observed by Runway program coordinators. Final selection of program participants will be made following another interview round.


Runway gives entrepreneurs "the cushion, connections, and coaching [they] need to take the entrepreneurial leap and succeed." The inspiration and culture for the program has its roots in the Stanford

The winners, working in self-selected groups of ~3-4, will incorporate a company, receive initial funding of up to $150,000 from Innovation Endeavors (in the form of a capped convertible note) and will proceed to work over the next 6 months, with the mentorship and support from Runway program coordinators, on identifying their business idea and building a business around it.

"Nothing comes from the top down," said Corey during our meeting. "We catalyze the entrepreneurs. The direction comes from them."

At the end of 6 months, which is the financial runway of the Runway companies, they will need to look for venture funding. Innovation Endeavors will not lead the round, but they will help with introductions and may participate along-side the lead investors.

Take Away

This program is obviously not for everyone, and not even for every talented entrepreneur. But I think this can be a great opportunity for some of you out there, so I wanted to help spread the word. More information can be found on the Runway Program website, and you can schedule your own meeting with Corey Ford here.

Inna Efimchik

Emergence Law Group  Emergence Law Group, specializing in assisting emerging technology companies in Silicon Valley and beyond, provides incorporation, financing, and licensing services as well as general corporate counseling.

Monday, May 9, 2011

Preincorporation Agreements | What Are They? | Do We Need Them?

Recently I have had several entrepreneurs ask me about preincorporation, or founders', agreements. To be honest, this surprised me. In the Silicon Valley emerging technology company practice, preincorporation agreements are fairly rare. But since the question came up, I thought I would share my thoughts on the matter with a broader audience.

So what is an preincorporation agreement? In simple terms, it's an agreement among co-founders about the terms on which they wish to incorporate their business. Why are preincorporation agreements rare? Instead of sitting down with an attorney to formulate the terms of the agreement, it is generally more efficient and cost-effective to use that attorney's time to incorporate the business on the terms you and your co-founders agree to. Essentially, incorporating sooner saves on the cost of drafting a solid preincorporation agreement that can withstand being challenged in court in the worst case.

That said, when might you wish to draw up a preincorporation agreement? The only time when a preincorporation agreement makes sense is in a situation where a group of co-founders is beginning to work on a project and decides to put off incorporating the venture for some time (perhaps 6 months or a year). While I would generally discourage this course of action, there are instances where the co-founders may, having weighed their options, decide to delay forming a company. To improve your venture's chances of survival through a long preincorporation phase, it is prudent to enter into a preincorporation agreement, stating both the obligations of the co-founders' in the interim period, and the terms on which they wish to incorporate the venture at a future time.

The terms that go into a preincorporation agreement are really up to the founders. The more detailed that they make the original agreement, the less they have to discuss/ negotiate/ argue over later, when the time comes to form and operate the company. Of course, the flip side of that coin is, if you get very specific and circumstances change (which is very likely to happen), everyone needs to agree to amend the agreement, and that can be its own can of worms.

Generally, you can think about the agreement in phases: (1) preincorporation, (2) formation, and (3) post-formation / operating the company. Below is an outline of some of the terms you may wish to include in each of the categories, keeping in mind that your individual business may have different needs and requirements.

(1) Preincorporation
  • Time commitment by each cofounder (pre-formation)
  • Deliverables / project description for each cofounder
  • Initial expenses / capital contributions by each cofounder
  • Consequences for any cofounder who fails to comply with the above terms
(2) Formation
  • Company name, state of incorporation, whether to reserve the name
  • Deadline to form the corporation
  • Authorize shares & founder stock grants, vesting, restrictions
  • Board of Directors
  • Officers
  • Ancillary agreements (e.g., to sell stock, transfer IP, account for bootstrapping funds, etc)
  • "S" status election for corporation
(3) Operations
  • Time commitment by each cofounder (post formation)
  • Positions of cofounders in the company, salary (if relevant)
  • Distribution of initial capital by category of expense
  • Authority to write checks
  • Authority to enter into contracts
Beyond these timeline-centered categories, the cofounders should think through the term and termination of their agreement. What happens if they don't incorporate by the time they state in the agreement? What happens if one of the cofounders wants out either before or after producing the preincorporation deliverables? Who owns the intellectual property generated during the preincorporation phase by the individual cofounders?

You can see that the level of detail and complexity of this agreement can be quite high. If it is not, how valuable will this agreement be in settling disputes among cofounders? If it is, how much time and expense will it take to put together the agreement? Bottom line is, unless there is a really good reason for you to put off incorporating once you've embarked with your cofounders on an entrepreneurial venture, skip the preincorporation agreement and take the plunge by incorporating.

And, my shameless plug at the end: whichever course you choose, or to discuss the best course for your company, Emergence Law Group is available to help.

Inna Efimchik

Emergence Law Group  Emergence Law Group, specializing in assisting emerging technology companies in Silicon Valley and beyond, provides incorporation, financing, and licensing services as well as general corporate counseling.