
Color CEO: The Tech Justifies the $41 Million - rwwmike
http://www.readwriteweb.com/archives/color_ceo_the_tech_justifies_the_41_million.php?sms_ss=hackernews&at_xt=4d8c0ec7f82bc4a4%2C0
======
MJR
_The company ... sees itself as "much more of a research company and a data
mining company than a photo sharing site."_

Wow - I bet users will gladly line up to upload photo and video to a data
mining company. From the start they plan on mining their users rather than
serving them. It really feels like all marketing BS when the core of the
business is to track, record and mine their users.

It may be good tech, but that's a horrible user proposition and it certainly
begs for a line-by-line analysis of their EULA since everything you do with
the app is public.

~~~
phlux
See my comment here: <http://news.ycombinator.com/item?id=2362592>

This is the telling quote:

 _"Lots of people are trying to create location-based services and using GPS,"
said Nguyen. "The problem with GPS is that it doesn't work."_

This is exactly my pointbelow -- the tech to incorporate all the sensor data
you can get from phones has real-world consumer uses -- but it has tons of
uses in intel as well.

They will get their patents, they will build the next google of social
intelligence and they will license all this to the NSA -- if they havent
already.

Sounds cool, yay. But no thanks from me.

Where I said:

 _"Here is some tinfoil for you...

Assuming they have a back-door API - this could be a freaking BOON for
intelligence gathering arms that are seeking to know the surrounds of anti
establishment types.

Further - wait until you apply spatial modeling capabilities (what was that MS
tech demo called?) where you can start building 3d navigable models of spaces
that all the data collected in that 100' radius allows.

Dont think the military is doing CRAZY things with optical intel:

"The system can also be used for general night vision; it can follow bats five
miles away in darkness."

<http://www.wired.com/science/discoveries/news/2007/02/72632>

the military now has autonomous robotic helicopters that can visually track
bullets in flight.

<http://www.wired.com/dangerroom/2009/02/gigapixel-flyin/>

Now they just need the general public to be a part of the larger sensor intel
fabric."_

~~~
jrussino
I think the "MS tech demo" that you were referring to is Photosynth:
<http://photosynth.net/>

~~~
mhansen
There's something similar in Google Maps, with geotagged Panoramio photos
stitched together into a 3D scene.

If the photos are dense enough, there's enough information to stitch together
the photos into a scene you can jump around. It's really cool!

EDIT: Here's a scene in Sydney:

[http://maps.google.com/maps?f=q&source=s_q&hl=en&...](http://maps.google.com/maps?f=q&source=s_q&hl=en&geocode=&q=sydney&aq=&sll=-37.786089,175.310037&sspn=0.011582,0.026114&ie=UTF8&hq=&hnear=Sydney+New+South+Wales,+Australia&t=h&layer=c&cbll=-33.873062,151.199711&cbp=12,0,,0,0&photoid=pg-
SShVc617Kce5BBCUcPpjqw&ll=-33.872429,151.19963&spn=0.006084,0.013057&z=17&iwloc=A)

------
vessenes
What's fascinating about this is how much Nguyen feels he has to say. In a
way, this is a serious blow to their plans; they have to reveal their world
domination plans early so that bloggers won't keep dumping on them.

That said, their world domination plans are pretty awesome. I bet they come up
with other ways to get you to 'soft checkin' on their platform. Just betcha.
Wouldn't you like to just open an app that lets you, say, ask for contact info
of people in a room with you? Like bump, but working, and low hassle? You
could use it at parties, at networking events..

I'm guessing the application thoughts just keep coming for the color team.

Unfortunately, what they really can't afford is to dig into a hole based on
bad PR right now; they need people out and using their app, and talking about
it, hence the opening up a little bit.

------
mycroftiv
I don't get this at all. What is the incentive for anyone to use this?
Everything in the interview is focused on the business model, with an
assumption that millions of people are going to start providing them with
data. On the other hand, I don't understand the attraction of any of the
existing "location check-in" brands, so my ignorance is probably meaningless.
I've always been very involved and interested in technology, but the last few
years of the growth of "social" products has left me baffled and alienated. Is
this what getting old is? Is my response to Foursquare and Color fundamentally
the same as the response of Old Fogeys to Elvis Presley and Chuck Berry?

~~~
tsestrich
I completely agree, and I'm 22. The fact that I check HN several times a day
should speak to my interest in technology. I would say this has nothing to do
with age, just a certain sense of what's valuable.

While time has shown that the average person can find a use for Facebook,
Twitter, and Foursquare, I still find it very difficult to see how "another"
social app... and a photo-sharing one at that... is going to draw the kind of
crowd that would make this extremely high valuation reasonable.

I would agree that, based on numerous comments across the web, the only reason
for such a high valuation is because of possible acquisition. But this article
specifically mentions that the company is not interested in being acquired, so
I guess I just don't "get it".

During the dot-com bubble, "eyeballs" were becoming as important a metric for
companies as "revenue" or "profit". It seems to me (and others here) that
we're seeing some of the same sentiment all over again.

The fact that Color will give me a 'dynamic social graph based on who I
interact with frequently' does not make me want to sign up. Then again, I
might not be their target market. I currently don't have much interest in
sharing photos on the internet with strangers just because they are nearby.

~~~
michaelneale
"thank you" for agreeing - as in for being 22 and still feeling that way.
Phew, it isn't just the age.

I think that there are plenty of people interested in tech with nothing to do
with any "social" aspects - it is just that social is new to the technology
field and has attracted a lot of talent and money. I used to think, and still
do somewhat, that "social software" is almost its own field of interest and
study - which will feed into other areas of technology but still be distinct.
Thankfully there are still plenty of other engineering problems to solve
elsewhere (there is, isn't there?) for people like us to work on !

------
jschrf
I've read this article multiple times now and I'm having a hard time
reconciling it with reality.

The app "intelligently identifies nearby smartphones, whether at a local park
or at a concert, using advanced proximity algorithms".

OK, I'm listening...go on...

"Lots of people are trying to create location-based services and using GPS ...
The problem with GPS is that it doesn't work."

GPS doesn't work, really? Is there more context to this quote? Maybe CEO Bill
Nguyen means that GPS doesn't _always_ work. Like, in a huge city with signals
bouncing off buildings everywhere.

OK, in that case, there's always cell-tower triangulation and/or Wi-Fi
positioning. Maybe that's what he meant?

The article goes on:

"Color does things differently by collecting these various data points from
the phone's sensors and then looking for proximity by looking for identical
inaccuracies."

This is where my eyes start to glaze over. You don't get magic quantitative
inaccuracy values from sensors, sorry. Unless you have some sort of magic
real-time control experiments - you don't have that information. Am I missing
something here?

Even if you can guage inaccuracies in arbitrary sensor data, how does this
possibly correlate to a 3-dimensional position in space and time without GPS?

I understand and appreciate the premise and value of the app here - no-effort
photo albums based on proximity, and a social graph prioritized by real-life
interaction - but this article triggers my B.S. sensors in a big way.

~~~
rwwmike
Okay, so these "sensors" come down to a lot of things. The compass, the
accelerometer, the camera, the microphone, bluetooth, wifi. And the tech here
is both about location as well as proximity. And actually, looking in my phone
settings, it appears that Color uses GPS _too_. It's on in the location
services part of settings on the iPhone.

I think the big takeaway is that it doesn't rely on it and it uses all of
these signals to provide a far more accurate sense of location and accuracy.
And I have to say, I'm not sure what about using more data points to get a
more accurate reading would set off B.S. sensors.

~~~
pmorici
Doesn't any app that uses the iPhone camera API to take photos need to have
permission to access GPS data because the iPhone embeds GPS coordinates of
where each photo was taken in the EXIF data. If it didn't it would be a back
handed way of accessing a persons location w/o them realizing it.

~~~
chengyinliu
If you turn off the location service for Color app, the app itself will
explicitly tell you that it can't work without the service.

------
rbarooah
I think the point he's making is that they are going to try to figure out your
_actual_ real-world social graph based on who you associate with and where.
I'm sure that was the killer part of the pitch.

If you forget about the photo sharing app for now, and imagine they do manage
to create such a graph - it seems to me that it would be a lot more valuable
than what Facebook calls a social graph - which is really more like a social
game.

Imagine being being able to identify the people who are 'hubs' and
'influencers' in real life as opposed to online. Now imagine you can predict
where they are going to be hanging out so that you can promote things to them,
and then track the fanout as they meet people in real life. That is what
Sequoia think their $41M might get them.

~~~
Lewisham
But they're in a situation where they _need a compelling application first_.
You can't get the data without multiple people opening up the application.
Color is really not compelling.

This is a classic problem I have in my own research at a university: in order
to test the cool stuff, you have to convince people using stuff they already
get. The convincing is way, way harder.

Maybe Color is just one of a suite of apps. Maybe the idea is to license the
patents to Apple or Google so it all happens transparently (but the idea that
my phone is silently collecting and transmitting data about me all the time
makes me want to puke). However, what they've got is going nowhere fast.

~~~
delineal
Agree 100%. The trick for them is to build a compelling application.

I faced a similar problem with delineal.com. Like Color, my groundbreaking
stuff is in the data choices, algorithms and data filtering and in my
generalized approach to solving problems. I don't lead with detailed
discussions of the technology because A) the vision and direction tell a more
entertaining story B) The matching and filtering algorithms do not a product
make. I need to build products that solve real-world problems to generate
revenue.

I like the recognition they're getting for their technical work. It bodes well
for me...and provides some nice hints about how to better frame my pitch...
because I can say "I have technology AND useful apps".

------
jarin
I think the worst thing they can do is come out and try to defend it. Instead,
they should probably internalize the feedback and keep working on the product,
so they can come back in a few months and say "See? THIS is why."

I don't think I ever heard any Twitter execs defending their product when
everyone was saying it was just for posting about your egg sandwich from the
toilet.

~~~
rwwmike
He actually offered no defense. I decided not to focus on the interface/user
experience because everyone else did. He pretty much compared it to a venue
that opened before it was ready. I decided to question them about the tech,
because that seemed to be the part nobody was really discussing and I figured
maybe all this money was because there was some interesting tech at its core.
I think there is.

~~~
jarin
Maybe I misread it. The article headline definitely sets that kind of tone
though: "Color CEO: The Tech Justifies the $41 Million"

------
ojbyrne
So there's an Onion thing about how Facebook is the dream app of the CIA. I
think its been superseded.

~~~
sireat
For those who are too lazy to look it up: [http://www.theonion.com/video/cias-
facebook-program-dramatic...](http://www.theonion.com/video/cias-facebook-
program-dramatically-cut-agencys-cos,19753/)

The Onion as always is on top of things.

------
thinkcomp
Am I the only one who thinks that contrary to the claims made by Color's CEO
in the article, GPS does work?

~~~
ihodes
Phone GPS, in my experience, really doesn't. It is inaccurate, oftentimes
100ft off, and certainly drains battery faster than just about anything else.

What part of it works, on a phone, for applications such as these? Or were you
just saying, in general, GPS technology does work?

~~~
jarin
I think GPS inaccuracy was the #1 reason Foursquare beat Gowalla. Gowalla used
to enforce strict accuracy on check-ins and it rarely registered you in the
place you were at.

------
Aloisius
Huh. Bill credits DJ Patil with creating this patent-pending technology that
checks locale, but DJ just joined Color and LinkedIn, his previous company,
definitely has an invention assignment agreement...

------
flipside
$41 million might justify the tech, but they better blow a large chunk of that
on some people with a clue on how to launch a product.

Just saying you'll have tens of millions of users in 3 months doesn't make it
so.

------
alphadog
6 patents pending? Is this all a big IP bet for them & their investors? That
could really set back under funded entrepreneurs working on similar solutions.

~~~
Alex3917
That's what I think. If you look at this quote:

"The more you interact with someone, the more persistent that connection
becomes."

Facebook already has been doing this for a couple years, but if Color sniped
them on the patent by a few months then that would justify the valuation
alone. Plus they have a solid team with at least a decent chance of building
something themselves, which is basically just gravy if the investors have a
guarantee of at least getting a 2x return by suing Facebook and a couple other
companies.

------
ihodes
I'm clearly in the minority here, but damn if some of this doesn't seem very
cool. Especially for the middle/high-school crowd, and college kids, who are
friends, generally, with people geographically close to one another.

If they sort out the issues plaguing 1.0 (and I think is clear they will),
this seems like something that would a least catch on with that younger crowd.

Plus, cool tech from what they said here. I'm glad to learn a little about it.

------
ziadbc
Not joking here:

Wasn't this the premise of the ending of 'Batman: The Dark Knight?'

Scary, hilarious, and amazing at the same time.

------
gs8
I guess the VCs think that if Color can get their patents the worst case
scenario will be that Color can become a patent troll.

The $41mil shouldn't even be a topic right now because the VCs that funded
them are some very experienced betters in the game. If they made this bet they
must have seen something. Honestly I don't see anything of value right now,
but then again I'm not into sharing photo's with strangers thing.

I also think they are not a social company like Twitter/Flickr but are hoping
to generate enough data using their mobile apps to be able to identify various
locations without gps and sell that data, sort of like that one company which
maps out locations using WiFi access point names.

As for this new bubble debate and Color's $41mil, no matter what the situation
you will always have a few people saying the market is good and a few people
saying that the market is too weak/strong. It's like the glass half/full
debate that can never go away.

~~~
ahi
It has patent troll written all over it. Right now it seems like they don't
have much more than an idea for a product and an idea for a business plan.
Even if their photo-sharing thing doesn't work, it's inevitable that others
will be looking to build social networks from cell phone data.

------
weixiyen
"Our data is so accurate that we know where you are," said Nguyen.

That totally didn't creep me out at all.

~~~
rubergly
I'm surprised there hasn't been more reaction to that comment. Maybe Nguyen
wasn't actually making as big of a deal about that as the article made it seem
by ending on that dramatic note, but this seems extremely creepy and I really
can't see people being okay with this.

From my experience, even general people are concerned about issues of privacy
with Facebook. We in the tech crowd are certainly more aware of it and wary
than the average Facebook user, but I'm pretty sure a sizable majority of
(potential) users have heard at least a little bit about the creepiness or
have noticed it themselves (through creepily relevant ads, "memorable status
updates", etc.). However, this only really became an issue after a significant
number of people already relied on Facebook, and couldn't see giving up a
reliable practical good to avoid the potential threat of privacy loss. But I
could really see the transparency Color is showing from the start, before
they've solidified any users, negatively affecting potential users. In some
sense, people became hooked to the drug of Facebook before they were aware of
the drug's negative side affects; Color seems to be announcing it's a harmful
drug with little high and expecting people to get hooked. I have no idea how
mainstream media will react, but if this ever does become the next Facebook or
Twitter, I would not at all be surprised if there were news stories warning
about the privacy issues, and then people might only know it as "that thing
that tracks you," and at that point I can't really see people opting into it.

------
Jabbles
The way I look at the $41m investment is not that Color is worth ~$100m.
There's no way it can be, with no users. Rather, I think the investors are
betting that in 5 years' time Color will be worth $10b. From the investors'
perspectives, they could be 95% sure that Color will flop and the bet would
still be worth making.

Of course, you could say this about any "social startup" that thinks it will
be "the next Facebook/Twitter". The investors have some reason to suspect that
Color's team will be more successful than most, and those reasons include
those mentioned in this article (previously successful team, new technology
etc.). With the large amount of capital they are even more likely to succeed.
But the chance that they will is still small, and yet it doesn't matter.

From this single data point you can't conclude anything about "the bubble".
The investors' bet is that Color will be _huge_ , not moderately successful.
The chances that it will be "the next facebook" may be small (I won't put a
number on it), but the potential ROI reflects it.

------
geoffw8
HackerNews, please tell me why you couldn't just create "PlaceBrowser", an app
that shows you all geocoded photos on the INTERNET within 100ft of you?

Pull the photos in from Flickr, Google. You don't get the initial "no content"
problem, and you can just store the photos on your own server.

Right?

------
tonystubblebine
Sometimes when I see these investments I wonder if there's just a different
opinion about what a lot of money is. To me, $3 million dollars is a lot of
money and I'd have trouble spending it. But maybe to a VC, that's barely
anything and an investment of $41M to people they've worked with before,
trust, and who have a pretty good prototype/story is perfectly reasonable.
That's why I haven't paid much attention to the griping other than to see the
headlines.

------
todd3834
I have to admit I didn't get it at first until I started playing with it while
some friends at the same location did as well. I'm not sure how much of this
will be blocked out by the fading social graph but I thought of some pretty
cool examples that make this app more interesting than I thought: 1\. Photos
from a house party, I'm sure you could see some entertainig pics. 2\. Buying a
house, it would be cool if you could actually get a ton of pics and videos
from the previous family to see if you'll enjoy the house and if they appeared
to take care of it. 3\. I've never been extremely drawn to social media or
even taking tons of pictures all the time. This, however, finally made it
interesting to me and I will use it. Assuming there are others like me, there
is a market for that.

I really have nothing to hide that would cause me to fear the data from this
app. Perhaps ignorant of what they could do (I can think of a lot of kind of
creepy things) but it doesn't bother me if they know about my location
surroundings, etc... Someone did say privacy matters much more when you have
kids, I guess that mint be the case down the road.

------
cardinalblue
Another way to think about it: Color is "Bump" without the need to bump
phones! Using various sensors, it can tell who you are next to, and then you
can exchange contact info, photos, and set up an ad hoc connection. Another
use could be to figure out what store you are in and offer you relevant
coupons...

------
heliodor
Wow, are they misusing that money! They say they need money for their amazing
data mining infrastructure, yet the Android app is in shambles. I press the
BACK button and the app can't even bother to exit! Never mind, the deeper
bugs. Makes me wish I hadn't uninstalled my app-killer app.

It looks like they are focused on step 2 of the business plan when step 1 is
broken.

We've seen over and over again that the household name big companies of today
have evolved through organic growth, not through this forced process that
Color is undergoing. $40 million is not going to buy you a fanatical fan base.
You have to earn it.

------
mleonhard
It looks like Color has a difficult chicken-and-egg problem.

------
Animus7
Regarding the hand-wavy title and explanation:

Maybe there's some magic in the bits I'm not seeing, but I see no "tech" here
that can't be churned out by a few ramen-eating guys on HN and almost zero
expenditure.

Even if you've lost it and you feel the need to provision for a million
dollars of DB hosting to handle the load, my plan still saves 40 million
dollars.

I'd like to think there's no bubble, but then I see this...

------
neutronicus
He's right. Who gives a shit about the stupid photo-sharing app at the end of
the day?

If they build a dark-knight-like smart phone data miner, they can always sell
it as a service to (or get bought by) somebody who already has traction.

Why care about traction if someone else might pay you to use theirs more
effectively?

------
marcamillion
How quickly the tide has turned.

I bet they are now regretting the headline: "More money than Google."

Talk about A LOT of unwanted attention.

------
robryan
Interesting that these guys go heavily against the idea that you should
release something early and iterate on it. Do people agree that it's good to
front load all this tech or should they have been getting the photo app right
and say used GPS for a first version?

------
waterlesscloud
Valuation plus- 6 patents pending. Maybe not a plus for innovation, but a plus
for valuation.

Valuation eh- "Our tech knows where you are". Maybe, but very likely not as
well as you claim, and even if so...eh.

------
ookblah
This is the batman sonar tech becoming a reality. Yessss.

------
earle
Favorite Quote: "Lots of people are trying to create location-based services
and using GPS," said Nguyen. "The problem with GPS is that it doesn't work."

------
fedd
looks like they are building a wordwide eyes and ears for some
extraterrestrial or computer mind. like the great evil
(<http://www.moa.dracandros.com/Great_Evil_(Fifth_Element)>)

------
phlux
I cant wait until Color data is used in a case to prosecute people.

"Your elastic social graph can and will be used against you in a court of law"

------
jawartak
>> There are real data needs and real capital costs.

What real capital costs changed between the $14 million they were getting
before Sequoia and when they got $41 million total including Sequoia?

------
foobarbazetc
$41M, and they still misspelled "colour".

~~~
cubicle67
<http://colour.com/>

------
mayukh
<http://www.youtube.com/watch?v=7rNw5nI_3iE>

