How$I$learned$to$stop$worrying$and$love$uncertainty$

!  Damon&Danieli&(@damondanieli)&! Microsoft&for&14&years&

!  Senior&Developer&in&the&Hardware&Group&!  Lead&Program&Manager&of&Xbox&Live&▪  Gamertag&‘d’&

!  Technical&Lead&of&Xbox&Entertainment&Network&!  Got&married&on&December&6th,&1994&

! Went&back&to&work&at&Microsoft&that&day&!  I&LOVED&Microsoft!&

!  Left&Microsoft&in&2008&to&start&a&company…&

!  Leaving&Microsoft&!  Getting&your&ducks&in&a&row&

!  Founding&a&Company&!  Types&of&funding&and&Risk&Model&!  Building&the&Founding&Team&

!  Life&on&the&“Outside”&!  Lean&Startup&Principles&!  Fun&Technologies&!  Running&Services&in&the&Cloud&

&&

!  Sharpen&your&saw&!  Buy&a&laptop&(you’ll&need&one&for&demos,&meetings,&coffeeshops,&etc)&▪  A&Mac&will&interoperate&with&a&lot&more&open&source&than&a&PC&▪  SSH,&homebrew,&“./configure&&&&make&&&&make&install”&

!  Research&what&is&out&there&(there&is&a&LOT&to&learn)&▪  Clients&(iOS,&Android,&PC,&Mac)&and&frameworks&(Cocoa&Touch,&Twitter&

bootstrap,&backbone.js)&▪  OS&and&Servers&(Lion,&Ubuntu,&CentOS,&etc)&deployment&(cap,&ssh,&git,&etc)&▪  Server&Application&stacks&(NodeJS,&Rails)&▪  Standards&(HTML5)&▪  Amazon&Web&Services&

!  Boring&stuff&!  You&have&it&GOOD&at&Microsoft!&!  No&Startup&can&match&your&paycheck&or&benefits,&but…$▪  Every$startup$that$has$a$successful$liquidity$event$will$beat$your$stock$awards!$

!  COBRA,&401k,&etc.&

Boothstrapping& Angel& VC& Profitable&

Independent&&Nobody&has&leverage&on&your&company&&Investors’&frowns&turn&&upsidehdown&&Hiring&easier&&Equity&small&for&new&employees&

Independent&&Nobody&has&leverage&on&your&company&&Hiring&very&HARD&&Portion&large&for&coh&Founders:&The&only&“wrong”&Answer&is&50/50&

Usually&“hands&off”&&Minor&leverage&via&&convertible&notes&&Hiring&easier&but&still&hard&&Common&stock&Equity&large&for&early&Employees&

“Capitalized”&&Stock&option&pool&83b&Elections&Preferred&shares&Board&of&Directors&Leverage&&Equity&comes&out&of&option&pool&for&all&future&employees&

Boothstrapping& Angel& VC& Profitable&

Independent&&Nobody&has&leverage&on&your&company&&Investors’&frowns&turn&&upsidehdown&&Hiring&easier&&Equity&small&for&new&employees&

Independent&&Nobody&has&leverage&on&your&company&&Hiring&very&HARD&&Portion&large&for&coh&Founders:&The&only&“wrong”&Answer&is&50/50&

Usually&“hands&off”&&Minor&leverage&via&&convertible&notes&&Hiring&easier&but&still&hard&&Common&stock&Equity&large&for&early&Employees&

“Capitalized”&&Stock&option&pool&83b&Elections&Preferred&shares&Board&of&Directors&Leverage&&Equity&comes&out&of&option&pool&for&all&future&employees&

When*you*become*profitable,*(in*your*investors’*eyes)*you**instantly*become*smarter,*more*handsome*and*your**

children*are*of*better@than@average*intelligence*

!  2008 ! Madrona&$1M&investment&

!  I&had&▪  No&PowerPoint&slides&▪  No&business&plan&▪  No&Clue!!!&

Goal:*Find*the*opportunity*in*the*iPhone*Space*

!  Client&!  iPhone&!  ObjectivehC&! Mac&+&Xcode&

!  Server&!  Ruby&on&Rails&+&MySQL&! Morph.labs&hosting&

!  I&built&several&initial&MVPs&(Minimum&Viable&Products)&to&test&if&there&was&a&market&

!  User&Generated&Content&on&Mobile&!  PhotoFeedd,&CarFeedd,&TravelFeedd&

!  Kids&game&to&test&out&“storybook”&market&!  Spell&Flyer&

!  Bluetooth&proximity&based&games&!  Showdown&Poker,&Gunslinger,&Psst!&

!  iOS&3.0&had&GameKit&and&Push&Notifications&!  These&were&the&initial&ingredients&of&a&Xbox&Live…&

!  2009-2010 !  Idea:&&“Xbox&Live&for&Mobile”&▪  Friends,&Invitations&▪  Multiplayer&Networking&▪  Voice&Chat&

! Madrona&$3M&additional&investment&

!  CEO&+&8&employees&

!  Server&!  Ruby&on&Rails&+&MySQL&▪  Client&"&REST+&JSON&▪  Marketing&website&▪  Developer&website&▪  Admin&interface&

!  XMPP&server&▪  ejabberd&

!  STUN/TURN&▪  Chlanguage&

!  Hosting&!  EngineYard&hosting&(Rails)&!  AWS&(XMPP)&!  NTT&(Global&STUN/TURN)&

!  First real-time multiplayer game platform for mobile!

!  First title was Big Fish Games’s Big City Adventure

!  Activision licensed our SDK for Call of Duty !  +++

The$toughest$technical$challenge$I’ve$ever$had$as$a$professional$

!  Pivoted into Freemium Social Games

!  What Eric Ries calls a lean startup pivot, I call a business iteration !  Pivots can be much more devastating

!  You get to tell all those people (friends, investors, family, employees, ex-coworkers, press, etc) whom you sold on your original vision that you were wrong

!  You get to fire staff that are not suitable for your new direction and lose the rest of the staff that feel your vision is not suitable for them ▪  We lost a great developer who said we were “arranging the deck chairs on the

Titanic” !  Q: Were we going to explode from internal pressure or implode from a

vacuum?

!  Standing at the doorway…

The$toughest$emotional$challenge$I’ve$ever$had$as$a$professional$

!  And&our&servers&immediately&collapses&!  In&our&rush&to&get&product&in&market&before&we&ran&out&of&

money…&!  We&knowingly&launched&before&we&had&the&full&server&infrastructure&in&place&

but$did$not$estimate$the$success$of$the$title$!  We&unknowingly&build&a&relational&structure&in&our&database&but$did$not$test$

the$write@load$!  We&unwittingly&had&a&clienthside&bug&that&would&sent&thousands&of&

messages&if$the$user$tapped$quickly$enough$!  We&unintentionally&exercised&“lean&startup”&principles$because$we$wanted$

to$stay$in$business$!  The&dev&team&and&I&hunker&down&in&a&windowhless&closet&for&5&

months&and&rewrite&the&servers&several&times&as&our&userbase&grew,&and&grew&and$grew$

!  Trade&Nations&is&a&huge&success&!  Over&a&year&later&it&is&in&the&Top&100&Grossing&Games&

!  We&launch&MetalStorm&Online&a&few&months&later&!  It&becomes&a&huge&success&▪  It&has&one&of&the&largest&leaderboards&(>5M&players)&of&games&on&iOS&

!  We&heard&that&Apple&had&to&increase&their&Game&Center&multiplayer&capacity&for&us&▪  Irony&given&that&we&stopped&being&a&multiplayer&game&platform&provider&to&

make&the&title…&

!  We&launch&Battle&Nations&in&November&and&it&was&the&#1&Top&Grossing&Game&on&iPad&until&January&

!  We&grew&from&11&employees&to&60&in&2011&!  We&have&been&profitable&ever&since&

!  Amazon&AWS&“Cloud”&+&RightScale&!  EC2,&S3,&ELB&!  Over&100&servers&

!  Java&!  We&needed&to&write&persistent&game&sessions&!  Developers&were&comfortable&with&it&!  Rails&is&not&designed&for&the&threading&model&needed&

!  MySQL&!  Used&as&a&dumb&keyhvalue&store&!  Consistent&hash&of&key&across&N&masters&

!  Node&+&CoffeeScript&!  For&lightweight&services&such&as&the&Maintenance&page,&Matchmaking&

System,&Push&Notifications,&Realhtime&Multiplayer&Servers&▪  The&first&company&who&can&write&a&realhtime&multiplayer&game&in&JavaScript&

!  Application&Stacks&!  Node+express+vows&▪  CoffeeScript,&bundler,&npm&

!  Rack+Rails/Sinatra&&▪  rbenv,&ruby,&gem,&cap&

!  No&SQL&stores&!  Redis,&MongoDB&

!  Tools&!  brew&!  Sublime&Text&!  git&and&github&

&

$ brew update$ brew install rbenv$ rbenv rehash$ ruby-build 1.9.2-p290$ rbenv local 1.9.2-p290$ gem install rails$ brew install redis$ rails new eastsideinc$ cd eastsideinc$ git init$ git add .$ git commit –a -m "Initial commit"$ rails server<HTTP Server is listening on 3000>

Mobile Device

HTTP

Mobile Device

Application& Data&Stores&Clients& Protocols& Offsite&Backup&

Hourly&Snapshots&

&Analytics&

&&Masters Slaves

HTTP

Load&Balancer& Caching&

Heroku AppJet

EngineYard Elastic-

Beanstalk

ELB&Pusher&

Elasti- Cache Redis- ToGo

DynamoDB&MongoLabs&MongoHQ&Redish&ToGo&RDS&

S3 # EMR

!  You&just&got&the&task&to&deliver&a&task&to&store&all&ad&impressions&during&the&Superbowl&!  And&you&have&3&days&to&bring&the&system&up!&

!  Shazam’s&results&on&DynamoDB&!  100,000&writes/second&over&4&hours&!  <3ms&latency&(avg)&!  <8ms&latency&(TP99)&!  1.4&Billion&writes&total&

!  Note:&this&is&10x&PEAK&tweets&during&that&period*&

*I&never&thought&I&would&use&“Peak&Tweets&Per&Second”&as&a&unit&of&performance&

!  Contact&!  damondanieli@gmail.com&(@damondanieli)&&

!  Have&Fun!&!  HTML5&+&Canvas&!  Node&+&CoffeeScript&+Redis&

!  Read&!  Getting$Real:$the$book&by&37Signals&!  Engineering$your$Startup&by&Swanson&and&Baird&!  The$Lean$Startup&and&startuplessonslearned.com$Eric&Ries$!  Four$Steps$to$the$Epiphany&by&Steven&Gary&Blank&