I was recently thinking about the changing business model for many brick and mortar stores, like Best Buy. Where Best Buy used to be price competitive, they now charge a steep markup in-store. People making these purchases seem to be mostly those unaware of the true price. I occasionally purchase from their stores as well, when I absolutely need a physical item and can not get it shipped. Chris had the pleasure of listening to me vent about the absurdity of purchasing a $25 ethernet cable the other day.

Basic economic theory holds that competition should put downwards pressure on prices to where they approach equilibrium, and are fairly close to the cost of manufacturing. Yet this is not happening for ethernet cables. Why is that?

When you boil it down, it seems to be convenience -- you're able to purchase the physical item when you want it, and examine it before you purchase it. Going further, though, convenience doesn't only apply to in-store items.

Weebly is a great example of the power of convenience. When we started off, we heard "Oh, web hosting... that's a commodity" quite a bit. Most people considered it a "solved" problem, and quite boring. But the problem of designing visually appealing content, uploading media, and hosting web pages was far from solved, and a simple, easy to use solution gained quite a bit of traction fairly rapidly.

Which begs the question: "How do you model convenience?"

When analyzing competition, it's quite easy to model out all of the service characteristics, such as features and price. In fact, if you compare Weebly to several horribly outdated web site creators, the feature list might not look that different. The user experience, on the other hand, would be. Where Weebly shines is its simplicity and ease of use. Or, more simply: convenience.

Hopefully, someone with experience could shed some light. How do you model for convenience?

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I had been eyeing up the SleepTracker watch, and was pleasantly surprised to receive it as a present for my birthday from my girlfriend a few months back. The concept is genius: Why wake up in the middle of deep sleep, when you can be awakened intelligently at the right time?

Sleep happens in multiple stages: Drowsiness, light sleep, deep sleep, and dream (or REM) sleep. This cycle repeats multiple times in a night, and usually lasts 70 to 90 minutes. You can read more about sleep stages at helpguide.org.

Ever feel like you woke up at "just the right time"? After each cycle, you are returned to an "almost awake" state. When you wake up at this point in time, you feel much less drowsy, and much more refreshed than when you wake up during deep sleep.

That's the point of the watch: to monitor when you move (when you are almost awake), and wake you up at the right time in a given window. Ideally, you feel refreshed every morning, ready to jump out of bed.

How well does it work? Surprisingly well. After several weeks of use, I was almost always woken up during my set window. Waking up in an "almost awake" state is much more enjoyable than being rudely woken up by an alarm, and you do feel like you're woken up at the optimal moment.

What does it not do? It won't magically make you less tired. Just waking up at the right moment doesn't turn 5 hours of sleep into 8. You can shake off that "sleepy" feeling much, much faster, but you'll still need just as much sleep as before. It may be tempting to set the window to the maximum 90 minutes so that you're always woken up at an "almost awake" moment, but I found that sometimes the extra 90 minutes of sleep was worth it, even if I wasn't woken up at the perfect time.

As an added bonus, the SleepTracker Pro connects via USB to a computer to let you download your sleep data in text, csv or xml format, which can be almost (or more!) interesting than its intended purpose. With a bit of digging around on their forums, you can even find a perl script that works (easily) under Linux and (with a bit of effort) under OS X.

I've uploaded a couple weeks worth of my sleep data:

sleep.zip
File Size: 5 kb
File Type: zip
Download File

Here's the perl script (sleeptracker.pl) as well as a helper script I wrote (trackmysleep.pl):

sleeptracker.pl
File Size: 6 kb
File Type: pl
Download File
trackmysleep.pl
File Size: 0 kb
File Type: pl
Download File
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Dog fight video 11/09/2008
 

Robby and I went down to Fullerton to learn formation flying, low and hi yoyos, lead and lag pursuits, displacement rolls and all other sorts of dogfighting maneuvers.

The pilots with us take off and land. Once we're in the air, the plane is under our control. Don't ask me how or why this is safe -- I still don't know, but it actually seemed relatively safe at the time.

Check out the video I put together to see us dogfighting, go inverted and into huge loops, and pull some other crazy moves.

The program is called Air Combat USA and flies out of over 15 locations across the US.

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In a couple week's time, the teams YC has invited will be flying out to Palo Alto for a quick, shotgun style interview that they'll base their funding decisions on.

If you've been lucky enough to get invited, here's a bit of advice on what to expect and how to get through it successfully.

What to expect

You only have 10 minutes, which is a surprisingly short amount of time to discuss your business. You won't have any powerpoints or presentations, but you should have a demo. You'll start off, talk for about 15 seconds, and instantly get bombarded by questions for the next 9 minutes and 45 seconds. It's easy to get off-track, so you'll need to answer the questions quickly while trying to steer the discussion on-topic. Don't be surprised if multiple simultaneous conversations end up breaking out (at one point during our interview, I think I was having 2 simultaneous conversations -- one with PG and one with Trevor, while Chris and Dan were having a separate discussion with Jessica).

What you want to accomplish

You have ten minutes to convince the group that:

(a) Your idea is pretty good (it doesn't have to be take-over-the-world good, but it can't be bad -- that reflects negatively on your judgement).
(b) You're smart, and are otherwise equipped to accomplish your goal.
(c) You can get shit done.

Preparing for the interview

Experiences vary, but our demo was a crucial part of our interview. It's very helpful keeping the discussion on topic, lets the team visualize your product, and, most importantly, proves that you can actually build what you say you can.

Having an idea is pretty easy, but actually being able to put it together with the right parts -- easy to use, decent design, smart UI choices, functioning feature set -- in a short amount of time is what will be the difference between your product launching or not. Not all launched products are successful, but all unlaunched products fail, so proving that you can get your product finished and out the door is important.

Code frantically to get some kind of working demo done before the interview. Two weeks should be more than enough to get something basic done. If you can't, or your demo is going to look like hell, I wouldn't bother showing it.

If you couldn't already tell, memorizing some kind of presentation isn't going to work too well. Sticking stubbornly to your guns is also not advisable. As others have mentioned, you want to strike a balance between being open to suggestion, and defending your opinions -- just be sure to defend the right ones.

Having said that, be sure you know your market in and out. You better know who your competitors are ("We don't have any" is not an acceptable answer), the history of the market (What previous companies were similar? Were they successful? If so, how did the exit? If not, how are you going to do better?), how you are realistically going to make money (for a 3 person company, at least $30,000/month), and a very good technical understanding of how you are going to get all this done. The YC application is a great place to start to look for questions to prepare for the interview.

Before the interview

Relax. Put on some music to get yourself pumped up on the drive over. Try not to be nervous (even though everybody is, to some extent). Investors make a lot of decisions based on their excitement, so get excited about your idea! It'll rub off on them. Get there a few minutes early to hang out with some of the YC Alumni. You can also practice your pitch, and get some quick last minute feedback.

After the interview

You'll get a call that Sunday with the news. Don't freak out if it's late (ours was almost 2 hours later than they said it would be, and I was nursing some serious stomach ulcers at that point).

If things are still the way they were, you'll only have one variable: what your valuation is going to be. Decide ahead of time what is the lowest valuation you'd accept (if there even is one you wouldn't), so that you are prepared to give an instant answer to PG when he calls.

After the call, take a few shots, call everybody you know and enjoy yourself! Then get ready to work your ass off and eat ramen for 3 months.

Note: If there are any Penn State groups interviewing this session, be sure to shoot me an email! I'd love to get together over a few drinks and hear about your idea.

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