Friday, March 28, 2014

Unified Communications, Benefits & Challenges

By: Alon Cohen EVP/CTO

Generally speaking UC is not a very well defined term. The term has lingered for many years; it morphed over the years as telecom technologies that can be unified evolved and became more conducive to unification.

I was recently asked by to discuss different aspects of UC in order to make it simpler for companies that think about updating or replacing their communication systems, do so. If you have free 30 minutes enjoy the following video.

Sunday, October 27, 2013

Practical Guide To Building A Small Business Customer Support Organization

By: Alon Cohen EVP/CTO

I was asked by ERANYC, a startup incubator in NY, where I mentor entrepreneurs from time to time, to give a presentation about how to build a customer support organization.

At where I currently work, our team have done tremendous job at that, and we recently won the New York NYER “Best Customer Service Award”.

After going through the process of building a support organization three times and after giving it some thought in order to give my ERANYC talk, I was able to put together this “practical guide to building a small business customer support organization”.

This short guide was inspired by Jeremy Watkins and Jenny Dempsey our customer support leaders at who worked very hard along with the rest of the company, to win the above NYER prestigious award.

I hope you will enjoy the guide… Part 1Part 2



Thursday, July 25, 2013

Can Watson actually replace customer service agents?

By: Alon Cohen EVP/CTO

I was asked to opine about the above question "Can Watson (the Supper Computer from Jeopardy) actually replace customer service agents?".

I have no doubt that computers will replace humans in many jobs in the time to come. I have seen the airline industry move from 5 person crew: a Radio Operator, Navigator, Flight engineer and two Pilots, to a 4 person crew as radio became simpler to operate, then to a 3 person crew as GPS and INS (Inertial Navigation System) became simpler, and currently only a two pilots crew when computers replaced the Flight Engineer.

Interestingly a pilot I flew once with, inside the cockpit of a Boing 767, told me that soon there will be only one pilot and a dog. When I asked the obvious “why the dog?” the pilot said “well, in order to bite the pilot if he tries to touch anything”.

However I think the future is not that grime for the Flight Engineers and humans in general specifically if you notice the fact that Scotty the flight engineer is still there in Star Trek.

Anyway if you like to read more about Watson, Speech Recognition and my take on using Watson for customer support check out my article in SpeechTechMag:


Thursday, March 14, 2013

The calm AFTER the storm

By: Alon Cohen EVP/CTO

Many articles discuss the relationship between company culture and leadership, and its strong correlation to the success of those companies.

One aspect of company culture that I want to discuss here is the sense of urgency that a company might or might not have. Sense of urgency to finish projects ahead of time, to deliver faster and to be the first to market. Some might call it competitiveness. There are, however, different types of competitive organizations and competitiveness, almost like our own good and bad cholesterol. The first type exist in organizations like Microsoft where the competition is between different teams and between employees inside the company, as attested by some of my friends who used to work there and a few articles. That internal competition in many cases impedes teamwork. 

The second type is the good one. It is the type of competitiveness which is projected outside the company. It lets the company be competitive as a team against outside threats and it provides companies the push to succeed. One aspect of that competitive drive is the sense of urgency.

Sometimes, however, even a good sense of urgency is not sufficient. I have noticed that many times a company will work towards a goal and achieve it ahead of its competitors. Results may look good and everyone is happy to come to work. In fact the company is so happy and self-content that it becomes complacent. The company keep comparing itself to its old self and forgets that now the game has changed. At this point every competitor is scrambling to do the same and even better if they are analyzing the product, identify places that can be improved and fix them in their own upcoming product. 

If you extend that “calm after the [release] storm” period, you basically give your competition time to recuperate, and you make it easy for them to get back into the game. The longer you stay calm the more chance they have to close the gap and maybe even win the race to the next goal.

Minimizing that period of complacency is critical to the company’s future. The company needs to be happy with its achievement but only for a very short while. It must set new goals, and start racing towards its new goal. It must also set its latest achievement as the new baseline and set goals to beat that yet again.

It is mentally hard to race against yourself when you know the competition is still behind. It is almost as mentally challenging as the “Individual time trials” in the Tour De France, in which cyclists pedal solo and are timed against the clock instead of against another rider.

Take for instance Microsoft. They released windows mobile in the early 2000 and as if they forgot they worked on it, they never followed through with it. Were they calm and complacent? Probably as usual. This gave Apple and later Google a chance to not only close the gap, but even win the market completely.

Apple on the other hand kept the pace up and kept the development and production pipelines warm as was proven by the rate at which they innovate and came out with new iXXX products, with new form factors and new software updates.

It is those companies and entrepreneurs who keep challenging themselves and keep outdoing themselves, that eventually collect the big rewards. Remember the old saying "the fact that you are not paranoid, does not mean there is no one chasing you".

What do you think?

Tuesday, September 25, 2012

Driving Forces Behind Startups

Not all VCs are created equal, however….

It turns out my gut feeling was probably correct. A newly released research by Shikhar Ghosh, a senior lecturer at Harvard Business School, shows that almost 75%-95% of VC backed startups fail. VCs would normally say that only 30% fail and the rest simply did not bring the expected results – big difference.

I founded few VC backed companies, and although my sample group is relatively small for any statistical relevance, I have been interacting with many other entrepreneurs over the years and kept hearing the same mantra, which is “VCs suck the life of companies”.

VCs typically (in spite whatever you think when you are funded or been told) work against the company instead of what seems logical to assume. The problem is they pull in different directions so the sum of all forces zeros out, in many cases they talk about extending runway on one hand and what they mean is for the founders to work for less, while they keep sending invoices for first class flights to board meetings (true story).

There is a whole ritual in the VC process, where initially VC and founders fall in love. Later if success is slow to come, they try to force changes. If success comes too fast, they get greedy and may block an exit, or even worse, try to take over bigger parts f the company by blocking next round depleting the company cash reserves only so they can offer a bailout bridge loan in bad terms for everyone but them. This triggers a whole company-VC hate cycle, where VCs try to replace the Founder/CEO and founders try to bring other VCs to reduce the power of exiting VCs, and the cycle repeats.

However, I think the problem lies at a deeper level than that. I recently raised my hand at an event to ask a panel of investors if they can envision a scenario where they invest with no preferences, I.e. everyone in the company, founders and investors alike, will have common shares. I did not have to wait a second; all of them, without any hesitation said NO, Never. They could not even envision something like that.

[As a side note: The preferred stock held by investors has more rights and privileges than the common stock issued to Founders. The most important rights that affect badly the founder up-side, is the right of the VC (preferred shareholders) to get paid before the common stock holders. If the company is acquired, the preferred stock holders will be paid first. Then, if any money is left over, the common stock stockholders will be paid in a prorated fashion, (i.e VCs get yet another dip).

As usually defined, the amount paid to the preferred stock holders is usually a multiple of the amount invested. For example, if Series A stock is sold to first-round investors for $1/share, the preference amount for that stock is sometimes a 4X multiple of the share purchase price.

Common stockholders should care about the preference, because that preference is "ahead" of the commons in any acquisition outcome. For example, let’s assume that the company raises $5m dollars by selling 5,000,000 shares of Series A preferred stock with a 4X multiple. That means that if the company is acquired for $20m (or less), the preferred stock holders get all of the proceeds and the common stock holders get nothing. In other words no upside to the Founders for exit of less than $20M even if they own 75% of the company]

Since in my past, I happened to be a co-founder of a company that was organized with common shares (and eventually went public at NASDAQ), I can tell you that the same love-hate cycle existed even when everyone had common shares, however the fact that parties had relatively equal “power” created a balancing force. It did two things, first it enabled the founders more maneuvering space to succeed in spite the investors greed, and second it protected the one common success factor everyone forget about, and that is the Founders’ upside.

Taking the upside from the Founder strips the company from its main driving force and converts the company from a potential success to a company with large chance to fail. I believe that this survey reflects that.

I believe investors should re-examine the assumption that they must have preferred shares, and start testing scenarios where everyone has common shares and where the founders are so motivated to make thing work that they increase the chances to succeed tenfold.

If VCs will see more success, they will become less greedy, interests will start to better align between Founders and VCs and with everyone pulling in the same direction chances are that more startups will succeed. The question is now which VC will be the first to create and lead that trend.

VCs often say that like horse track gamblers, they bet on the jockey not on the horse. If I to continue that analogy, I guess placing a nice juicy carrot in front of the jokey can dramatically improve the odds of winning the race.

What do you think?
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