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High Tech Realm: Startup Tech Businesses

‘Research has shown that monkeys are the most effective element of advertising’ the previous quote being part of the light closing remarks of an intense day of presentations and roundtables which were a part of the New York BootStrapper Summit; an invitation only event for venture capitalists and entrepreneurs to network and learn from leaders in the industry.

For those who are wondering: the American flag and a family in front of a picket fence round up the top three most effective symbols to use in an advertisement.

Even if you aren’t looking for investors nor have an existing business, the material covered during the sessions is essential,’ even for’ those who aspire but’ have yet to come up with a business idea. For example, the key point’ expressed ‘ throughout the sessions by’ multiple presenters said advertising is no longer a viable revenue model, with one venture capitalist going so far as to say they automatically reject business plans which use advertising as the sole source of revenue.

Regardless, such an aspect hasn’t hindered innovation, as shown by the diverse array of startups presenting at the event. The new trend is in monetizing content rather than offering it for free. Although the topic cannot be fully discussed in this column, Robin Kent, founder of Robin Digital,’ mentioned a startup in the works which sounds partially like a mix of Pandora and eHarmony.

The startup is a dating site which has users take in-depth tests on their tastes in music and also has them pick ten songs they would like other users to buy for them. In turn, the system then picks matches for you based on the taste in music, which in theory is a more accurate picture of yourself than the blurbs people commonly write about themselves on dating sites. Kent upped the reception of the business model by mentioning how it is a way to get users to pay for music, even when they can obtain the content for free.

Going back to the advice portion of the conference, for those who reach a level where loans or investments are necessary it is important to note that debt, unlike equity, is expected to be repaid. In the world of business, investors expect high returns on their money (such as a stock doubling in value) whereas lenders focus on only getting paid for the money they lent.

Michael Moretti of SVP financial group seemed to emphasize this point the most out of his fellow panel members, likely due to the fact he was the only lender (rather than investor) on the panel.

Now, if you don’t have an idea for a business or feel you should not bother with business because you feel like you are just a college student, you would be surprised at the opportunities that are afforded to students. Calvin Chiu, of Columbia Technology Ventures (part of Columbia University), cut straight to the point when he said that Universities receive government funding to back research for a reason ‘- that the areas are havens of innovation.

Of course, academia has a very different culture than the business world, an important point to keep in mind when trying to partner with universities. Alex Martinez, of Engineered Care and former professor at the Massachusetts Institute of Technology, kept the solution simple by saying you need to understand the reasons people went into academia and from there strike a balance between the goals of the academics and the goals of your business.

Even if you are only a student, conducting a patent search and researching projects at your university can provide a foundation for you to work off of when searching for the next great idea. The official government website for patent searches is uspto.gov, however Google Patents (google.com/patents) is a worthwhile and simpler alternative.

Going back to the beginning topic ,advertising, although advertising revenue has gone down the drain, why do well known companies like Coke spend millions on advertising? Jonathan Mendez of RAMP Digital, an advertising and marketing specialist pointed out the reason is to ”hellip;get you to pay one dollar for a product which costs four cents to make.’ Familiarity is key, and the importance has only increased competition. However due to the large scope, typical online ads are no longer effective for most businesses.’

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