Michael Yuan

At eZee, the founders made a conscious decision to start our company in University of Texas’s Austin Technology Incubator (ATI). To be honest, I did not really know what ATI does when I joined eZee a couple of weeks ago. Okay, I knew that it provides its portfolio companies very cheap office space at prime locations, offers low-cost shared admin / IT / legal services, and provides access to technology investors. But still, while those offerings are nice to have, they do not seem to be strategically important to us — we are not some cash-strapped no-name startup (actually, the ATI would not admit no-name startups to begin with). ATI gets part ownership of the companies in its portfolio. If all ATI offers is operational help, even one percent ownership would seem a very steep price to pay.

Now, two weeks into my startup life, I finally begin to understand the value of ATI. The “access to UT’s brain trust” sounds very abstract, but it is in fact very valuable to any startup. How? Let me explain …

Most technology startup companies are built on a specific business idea and a specific piece of technology to give them an “edge” in that business. However, as they’d like to say, good ideas are a dime a dozen. It is pretty much guaranteed that someone else is already trying the very same thing. While the business and technical leaders of the startups are probably familiar with the competitors, and have general confidence that “we can execute better.” Very few people actually have the time to go through the quantitative exercise to determine exactly how much better we need to be in order to not only beat the competition but also reach our own goals of valuation / market penetration etc. That is especially true for a company like eZee, since we have entering a very big landscape where virtually all ideas have been tried, and many companies have failed or succeeded to various degrees. The founders of eZee would have to do quantitative research on hundreds of mobile-related companies — including to analyze their execution strategy, financial statements, and finer details of their products / marketing. That is certainly not possible for our busy CEO / CFO / CTO, and beyond the capabilities of technologists like myself.

So, here is where UT and its highly trained MBAs can really help out. They not only study the products and strategies of our potential competitors, but also analyze their financial to determine what our valuation will be if we are in the same space. They help us understand how the market is segmented, and the key differentiating points our company should focus on. That has turned out be to very helpful to the eZee management team, and trickled down to the techies as new product requirements and new delivery timelines etc. I believe that eZee will have a much better chance of success if we go through the analytical studies with ATI on a regular basis.

As we build our product, we can also expect ATI to help out with consumer behavior research, target custom surveys and focus groups etc. All those researches are crucial for the success of the consumer mobile product we are building. They require a lot of specialized expertise and man-power that we cannot possibly deliver on our own as a young startup.

Okay, so much for the ATI’s benefit to startup companies. How about the employees in those companies? What are we personally getting from working in an ATI company (well, aside from getting rich from the success of the company as a whole!)? The answer is networking. The ATI building is like a little silicon valley of its own. You can walk around the hall, wonder into other startups, learn what they are working on, and even discuss collaboration opportunities. That is very different from the working-in-my-own-basement startup experience. In the long run, this kind of networking will help us individuals to advance our careers, come up with new ideas, and even assemble teams later to implement those ideas.

All in all, even from my casual observation point, I am now convinced of the value of ATI (and by extension, the MBA education). I hope that we also get to work with those guys on the technical front (EE/CS graduate students?) besides the business front!