The morale at Exbiblio is noticeably higher than when I was there a month ago – and yet everyone is far more aware of all the numerous tasks that still need to be done to get a functioning prototype in their hands. It’s a strange conundrum. They know better than ever that they are on a long hard road, and yet they feel more satisfaction from their daily work.

Ian MacDuff, who looks like a much happier engineer than last time I saw him, tells me that it comes down to good process starting to be implemented. There is now a list of tasks and milestones. As these get ticked off, people feel they are making progress. What he warns against is the “death march” which describes a project where you continually think that you are almost done, and constantly disappointed to find that you aren’t. It seems never ending, largely because you can’t see how far you have come down the road, or indeed where the road finishes.

Ian believes that good process begets more good process, because as people understand its value, they start to demand more of it. Information empowers, even if it tells you what you don’t always want to hear. There’s a motto pasted on the window of his office: “The truth will set you free, but first it will piss you off.” (Perhaps those words could apply to transparent blogging).

Ed Mahlum – for the management – also sees a discernible improvement: “I don’t think we were doing as good a job as we could in the way we were managing our work. We are now very specifically tracking all the work we are doing. Everything is much more concrete. This is bread and butter project management stuff.”

So why was Exbiblio not doing this before? I don’t think it’s because the management were naive or inexperienced, but it was a deliberate attempt to foster creativity and experimentation. Ed still says “the presumption of not knowing everything is a very good presumption”, but he now thinks that the creative / development process was too loose, and perhaps there should have been a better defined box to play in.

Ed believes that the improvement in morale is also due to better communication of Exbiblio’s environmental project, Compendia, which is starting to take shape.

“It’s always been there in word, but no one has been working on it, aside from a few conversations here and there. It makes it real to put effort in there and for people to see it.”

Hilary Franz is an environmental lawyer who represents non-profit environmental organizations. She divides her life between her environmental legal work, small scale farming, home-schooling three boys, and working at Exbiblio. On her desk at Exbiblio there is a book called “Collapse” by Jared Diamond – her reading matter is an indication of her serious concerns about the environment, and the direction of our society.

She admits to being “challenged” by the whole notion of technology. She points to her computer and says that it has a “real world environmental impact”, and in fact, she would throw it out of the window right now, if it were not for the fact that she couldn’t do her legal work without it. She recognises that a computer has benefits as well as minuses for the world:

“It also provides an opportunity for connecting people to education and information that is going to create power for change in the world, and help create a sustainable environment,” she says.

This is why she insists that we should “do honour to Exbiblio”, because Exbiblio states in its values that technology in itself is valueless. It must be a force for good through information, connections, knowledge and the power that comes from each of these to change and improve the world.

Hilary is starting to investigate the best model for Compendia, the non-for-profit organisation set up by Exbiblio to work on the environment. She believes that Compendia goes right to the heart of what makes Exbiblio “so different.”

“People should be inspired to work here every day,” she says. “Wealth will be generated by this product that will then go to fund real life world-changing work; preservation of rain forests, environmental education, tackling climate change. It’s not just about what Exbiblio produces. We are creating a model. The hope is that we will go out and spread this model, speaking about it, talking about it, sharing it with others to transform the way corporations operate.”

“This is a corporate redesign. We are establishing a new set of norms where we direct the creativity and resources of business towards the great challenges of creating a sustainable future, and where the power of real change can be an engine for creativity within the company.”

She says that other companies create wealth, and only then think about whether they might donate some of it to good causes. Exbiblio is about fully integrating its values with the work that it does on a daily basis.

As for Exbiblio, she says, “Here’s a company that’s doing work that needs to be honoured! They are dealing and grappling with the issue. Many companies historically have not always looked at the environmental impacts of doing business. Exbiblio is wanting to make sure that they are not just designing a product to make profit and that will cause harm, but instead they are planning to make profit, while minimizing the harmful impacts, and maximizing value for the environment.”

She concludes,”We can’t say ‘if” this is going to happen. This needs to happen. It has to happen.”

Exbiblio’s friend Bill Valenti joined the team for the regular Wednesday lunch. Bill and Martin King were both founders of Tegic which created T9 text-inputting for mobiles, and eventually sold to AOL. Bill’s current venture is Melodeo which puts music and podcasts on mobile phones. Martin asked Bill to reminisce a little about Tegic days, and the experience of raising funding.

Bill recalled that in 1996 the company was running perilously low on funds. They had turned down some offers to licence their technology to mobile phone makers on an exclusive basis, as they saw that as limiting its potential. But an opportunity to discuss putting T9 on mobiles in the Korean market with Samsung. Tegic saw that an exclusive deal in the Korean language contained the downside quite nicely. This first Tegic agreement also included a license for the US market, but was not exclusive and was for a limited term.

Bill and Martin flew out to Seoul for a few “extremely intense” days of negotiations. They were two entrepreneurs from a Seattle startup dealing with a global corporation. Fortunately Bill had been a banker in Seoul in the 1970s and had lent money to Samsung in that capacity. He brought out the business cards of the first chairman of Samsung and the people he had helped 20 years back. He also speaks enough Korean for social chit-chat and singing (karaoke). All in all, they got on well and came back with a deal worth 1.6 million which was paid up-front without any loss of equity in the company.

The first revenues in-the-bank led directly to Tegic’s very-well received first round of external funding, completed only a few months later. Bill thinks it preserved 25% of the equity in the company for the existing investors, management and employees. And Martin believes that this transaction and relationship with Samsung was the making of the Company.

“Timing is everything” concludes Bill, and he endorses Exbiblio’s approach of waiting until it has a product in hand before it goes to investors. It’s entirely logical to want to negotiate from a position of strength, and there’s nothing like revenues for breathing life into a startup.

Here’s another list of start-up mistakes that bloggers are pointing towards. I’m not saying that these are directly applicable to Exbiblio, but some of them just make good food for thought.

Don’t get too attached to your original plan, because it’s probably wrong.

Exbiblio is aware of the sin of obstinacy, and has left quite a few key decisions until very late in the day, to allow for discovery of what users really want.

Having no specific user in mind is listed as another start-up slayer:

A surprising number of founders seem willing to assume that someone, they’re not sure exactly who, will want what they’re building.

And here is some advice which I think Exbiblio should take pretty seriously, given that it doesn’t have much of a marketing budget:

If you’re going to attract users, you’ll probably have to get up from your computer and go find some.

Perhaps one day somebody will write up the ten things that start-ups get right.

It was a morale boosting morning meeting this morning. The prototype for the oPen (Exbiblio scanner pen) was dragged across some text, and lo and behold, after about 15 to 20 seconds, the text appeared on a big projection screen. Yeah! The wait has to be reduced to one or two seconds, of course, but it’s a step in the right direction. The whole process of integrating the hardware and software has been taking rather longer than planned.

The hope is that when mark II is ready towards the end of the year, it won’t have these integration problems, as most of the software kinks will have been ironed out.

A recurring theme centers on the ambitions of the product launch, scheduled for next spring. Exbiblio hasn’t set aside big resources for marketing, so what would be considered a success?

Increasingly I’m hearing that this product launch is really about proof-of-concept to raise capital to go onto the next stage. It might, for instance, prove market acceptance among a well-defined, local group – perhaps among students in the North West of America. This might be enough to find partners who would help Exbiblio with achieving is ambitions, which are, of course, far greater than this.

A meeting that I’ve just attended (with a presentation by Adam) really boiled down to this question: should Exbiblio start by doing a small number of things incredibly well, and to clearly communicate those things to a well-defined first-user group? Or should it be more feature-rich, and even have an open platform to develop third party applications?

It boils down partly to practicality – what can be achieved given time and money – and partly to the best way to market it. Exbiblio, and in particular Martin, keeps coming back to the notion that you have to put the product in users hands, and see what they do with it, and only then can you reach a decision. It means that the feature list will be finally decided on rather late in the day.

I’ve been away from Exbiblio for about three weeks, and I’ve come back to find what seems like a different company. It’s organised, and focused, and people meet frequently in person and know what each other are doing. I am, quite frankly, amazed.

While I’ve been away, I get the feeling that there has been a bit of a mini-crisis. There have been more little things wrong with the first prototype of the scanner pen than had been expected. This crisis seems to have been a shot in the arm.

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As we all know, time is money. When a business has run out of one, it’s also run out of the other. So timing is crucial.

The thing that concerns me most about Exbiblio is time. It all seems so tight to me, that there doesn’t seem to be any margin for unpleasant surprises. And it’s already behind schedule. I would think that an ordinary business would be looking very actively for investors to buy it more time, and a strategic partners to help it get its product to the customers. Exbiblio doesn’t seem to be doing either of those things – at least, not in full gear. But then it isn’t an ordinary business.

I put my concerns to Martin, and he responds that he wants to hand a product to investors and partners, not just a “vision” with hypothetical sales projections. Exbiblio won’t have a product until early next year. So actively approaching partners is on hold.

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by Jeremy Faludi

Originally we had planned for the oPen’s case to be injection-molded out of plastic or other materials with plastic’s useful properties. We’ve since revised that (and I’ll describe what we’re doing now in another post), but I thought it would still be helpful to describe the process of choosing a good plastic and publish the data that would help other companies with similar products make their own choices.

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