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When the drawing board is the business plan
Web 2.0 start-up experiences rite of passage — try, try again

by Arden Pennell

There's a saying among Web 2.0 start-ups, according to Palo Alto entrepreneur and start-up veteran Shailendra Jain.

In creating online social services, such companies throw their product to the public before it's perfect. They rely on early feedback to improve, leading to a certain self-deprecating adage, Jain said — "If you're not embarrassed by your 'version one,' then you're not a Web 2.0 company."

Using that logic, Increo Solutions, a start-up founded and run by students who graduated from Stanford University this month, is definitely a Web 2.0 company.

Founders aren't embarrassed, exactly — but they have a busy summer ahead of them. Their first Web product, a collaborative-feedback site called Backboard, needs expanded password services and other tweaks, according to Increo co-founder and CEO Kimber Lockhart.

Backboard, available for free at getbackboard.com launched in spring — twice. After a debut to Stanford students for early feedback, the site was pushed to the public in late May.

Despite an early flurry of users, sparked in part by a posting on the popular blog TechCrunch, visits have dwindled to about 100 daily.

Blame graduation, Lockhart said last week, sitting in the company's new Mountain View office.

Wearing flip-flops and an oversize Stanford sweater, she explained the necessary rite of passage had paused the group's efforts briefly. It required, well, actually attending the ceremony, moving into new apartments and spending time with family.

Increo's chief operating officer and her friend since freshman year, Jeff Seibert, was still busy with family three days after graduation, she said.

"Jeff's out with his family right now because they stuck around. I kicked mine out. I was like, 'Guys, I gotta start,'" she said with a laugh.

Meanwhile, despite her impending July wedding, Chief Technical Officer and co-founder Rebecca Illowsky had been at the office since almost sunrise, coding.

Yet as they worked and watched workmen install equipment on the freshly painted walls, the team was downright cheerful.

Rifling through a pile of paperwork, Lockhart uncovered proof she had signed a check for Jim Puls, the first post-incorporation employee.

"I paid you, Jim!" she exclaimed, holding up the sheet.

Puls, a software engineer who left Apple and took a 30 percent pay-cut to come to Increo, rolled his eyes good-naturedly.

"Only at a start-up," he said. "'The payroll system works. Yay!'"

Illowsky looked up from her laptop.

"We've been working for free for a long time. It feels really good to get a paycheck," she said.

The three founders and Lead Engineer Ray Thang are glad to be done with school and dig into the business full time, they said. Along with Puls, they are eager to work on improving and publicizing Backboard, Lockhart said.

The site's interface is simple, easy-to-use and attractive — qualities that distinguish it from other group-feedback and group-editing services, according to Lockhart.

Yet it is perhaps too simple for some visitors, who were nervous about privacy. They asked for a password-protected service, especially for work-related documents or images, Lockhart said.

Increo created a login option in response, but the team isn't finished yet. They must also work on the payment system for their premium services — including a semantic search engine that will find and link corresponding ideas among a company's employees — which they hope to be beta-testing by late fall, Lockhart said.

And the group wants to raise Backboard's profile through grassroots marketing, a task an upcoming intern will be dedicated to, the CEO explained.

Jain, the local entrepreneur who has founded three start-ups and whose most recent, Abaqus, went live this month, said Increo's situation is typical. Creating an online service is an iterative process, he said.

"You see this quite often. You get it out there as soon as possible and you start getting user feedback because the last thing you want to do is [try to] wait until it's perfect before you release it," he said.

Jonathan Teo, vice president at Menlo Park's Benchmark Capital — a firm whose investments include eBay and Yelp — said a long period of working out snafus can be a good strategy.

Web companies hoping to sell services to large businesses benefit from testing among the general population first — it refines the product, he said.

In coming months, Increo will have help in the tweaking-and-shaping process in the form of Puls, who joined in June.

Puls, 24, explained he came to Silicon Valley right after graduating from Carnegie Mellon. He took a job at Apple but secretly hoped to experience the energy of a start-up. So why did he pick Increo?

He knew he could trust the people, Puls said. He met Seibert earlier, when the Stanford student interned for his team at Apple. Now, Puls is working for his former intern.

According to Lockhart, Increo's salaries range between $60,000 and $70,000 — roughly a third less than what the team of five could be making elsewhere.

But they say the lower salaries — funded with seed money from venture capital firm Draper Fisher Jurvetson — are worth it.

Puls brings a teasing wit to the upbeat group. Looking over a workers' compensation form Lockhart asked him to sign, he deadpanned: "You're supposed to give this to us in Spanish, too."

And as Lockhart hovered near stacks of not-quite-unpacked stuff, Puls said drily, "We have two fax machines, which may exceed the number of faxes we've ever sent."

When the workmen finished installing whiteboards — which were actually inexpensive shower siding bought at Home Depot to save a buck, Lockhart explained — Puls jotted a note of celebration on one: "Hooray! We have Whiteboards!"

If summer goes as planned, Increo may soon have plenty of users, too.

Staff Writer Arden Pennell can be e-mailed at apennell@paweekly.com.