power-of-habits

Book Club Notes: The Power of Habit

Norðurskautið Book Club had its first meetup recently. We discussed the book The Power of Habit by Charles Duhigg. The book tells the story of habits, both personal and organizational. It discusses how powerful habits are in our day-to-day lives, and how you can change yours to the better. It’s a mix of stories and research, with insights into how people changed their habits. It also looks at how leaders at big companies used understanding of habits to turn them around.

You can join our book club Facebook group here. Our next book is Give and Take by Adam Grant. Also, if you’re interested Power of Habit, please use this link to buy it, and support Norðurskautið 😺

The book club uses a modified version of this book club blueprint that started at QuizUp (in their book club). We took several minutes thinking on our own about the book and writing notes to put into four categories: Highlights (things about the book that we liked), Low lights (things about the book we didn’t like), Themes / Takeaways (our favorite concepts, themes and ideas from the book), Applications (ideas on how to apply the book’s ideas in our lives or at our companies).

The following is a write-up of our thoughts and discussions:

Highlights

We thought the book was an easy read that had many interesting stories. The story of Alcoa and the guy who had no short term memory were highlights.

Lowlights

It’s a bit long — we didn’t think the author needed all the anecdotes he put in.

Themes / Takeaways

Habits control much more than we realize. We’re on autopilot a lot of the time. But, by realising it, we can spot them, and change them. One of the key points to changing habits, is believing you can change habits. Basically: We don’t think.

Identifying keystone habits can be an effective tool when initiating change (and never let a crisis go to waste). This is true both for organisations (Alcoa story) and personal well begin (exercise tends to have a cascading effect.

Killing a habit is hard. But, we can more easily change one we already have, so instead of being a bad habit, it becomes a good one. Example: instead of trying to not have a snack at three o’clock, change it out for a healthy snack.

Applications

Continuous delivery as a keystone habit. We can think of CD as a keystone habit, because integrating it tends to affect much more, like testing, releasing software and more.

Starting your day with a habit, sets the tone for the day. Suggestion: make the bed.

Creating more small wins, because once winning is a regular thing, the hard things just become part of a chain. Embrace small victories to form good habits.

The next book club will be on July 26th. Join the Facebook group here, and get your edition of Adam Grant’s Give and Take here.

 

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The Memo: Where are the community driven startup events?

Last week, Óli Johnson, co-founder of Rainmaking Loft and Catapult, was in Iceland. One of his stops was a breakfast meetup at Startup Reykjavik where he discussed community building. I couldn’t make it, but met up with him (Daði joined as well) later.

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As expected, our discussion quickly turned to the Icelandic startup community.

Where are the community driven events?

The Icelandic startup scene has become more lively in the last couple of years. We have had five Startup Iceland conferences, and this summer is the fifth batch of Startup Reykjavik companies. These events have come to mark a rhythm in the startup scene. This fall we’ll have the second Slush Play, which will likely become the cornerstone event in the fall.

These events have been important in making the startup scene more prominent, and connecting people. They are also prominently sponsored by big companies (Arion Bank, Industry for Innovation, Deloitte, and more) and professionally produced.

What’s missing are the community driven events. The ground-up beer nights organised by founders to meet with other founders. Why isn’t anyone organising that?

The developer community actively organised meetups. The most prevalent and successful ones are probably the Javscript meetups. Kristján Ingi and the team have worked hard at growing that community. Their work is culminating in JSConf Iceland 2016, which will be in Harpa. JSConf is one of the biggest javascript conferences in the world, and it will organised by the team behind the Javascript meetups. The JS meetups are works of passion. Where are the startup meetup works of passion?

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Please note that I’m by no means trying to belittle the effort put in by the Startup Iceland or Icelandic Startups teams. I’m just asking why the entrepreneurial spirit, that’s evident in the companies that we are building, isn’t being put to work in community building?

Is anyone working on events like these? Would you like to? Send me a message (just hit reply) and let’s see if we can make something happen.

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The Memo: First look at Startup Reykjavik

Sorry for being late with this week’s Memo. I had a very busy weekend. Also, I was at RÚV’s Morgunútvarpið this morning (link) discussing Norðurskautið and startup funding in Iceland (Icelandic). Now, on to the Memo.

Startup Reykjavik kicked off

Last week saw the first public event of Startup Reykjavik –– the accelerator run by Icelandic Startups and Arion Bank.

The event was a pop-up and pitch where five companies in the 2016 batch pitched. Vísir has written introductory articles to all the companies participating this year.

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The following companies pitched:

  • Platome, a B2B life sciences company that makes a solution to grow stem cells. Currently scientists use animal derived serums, which Sandra, the CEO, referred to as animal blood. The product is rooted in academic research, which sounds good. However, I don’t know the first thing about biotech or stemcells so don’t take my word for it. (Vísir link)
  • Isold Film, a financial instrument for the movie which I didn’t understand completely. It seems to rely on the tax refund for movie projects and is structured as a PE fund (2/20 structure). Also, I’ve never heard of a PE fund participating in a startup accelerator.
  • Moon Chocolate, makers of fair trade, organic chocolate. Sound like a competitor to Ommnomm, who’ve been doing good. Hopefully there’s room for two similar chocolate makers here, although I haven’t seen a 10x return on artisan sweets manufacturing yet. (Visir link)
  • Noted, described by the founder as “AirBnB for school notes”, where notetakers can sell their notes to other students. Here’s an intro video from the team. Allowing people to sell their content like this is a good idea, but the pitch didn’t address the real issues with starting a platform: creating enough supply and demand for it to grow organically. Looking forward to their final pitch on demo day. (Visir link)
  • The fifth was Icelandic Lava Show, an attraction that allows people to experience molten lava flowing through a room. I hope they aim at being a global attraction. Imagine going to the Icelandic Lava Show in New York City — similar to Madame Tussaud’s which is everywhere. Would strengthen Iceland’s brand and make for a better investment opportunity than a local only thing. Could even become a franchise. (Visir link)
  • Other companies that didn’t pitch: Flow, Strivo, Convex, Drexler, and Total Host. Full list here.

The pitches were surprisingly good. I say surprisingly because the companies have only been at Startup Reykjavik for a couple of weeks. The founders were prepared, passionate, and their message was refined.

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Last year, after the demo day of Startup Reykjavik batch 2015, we interviewed Linus Dahg, investor at Wellington Partners in London. We wrote:

According to Linus, many of the companies pitching were not optimal VC cases. “Great businesses, but not optimal in terms of how big they can become. I did a blogpost about what we look at from a venture point of view. We have to look at companies that can return a minimum of 10x, and that have the possibility of becoming a 30x investment.

I think his thoughts are still relevant — although I hope to be proven wrong in this years demo day in August.

In other news 

We’re looking into expanding our reports and research functions. If there’s something you’d be interested in having a report or research on, shoot me a message — we’re looking for interesting things to study.

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Data Dwell secures $1.2m in funding

Digital asset management (DAM) company Data Dwell has secured a $1.12m (140m ISK) funding round by Frumtak Ventures. The company also received a $80K (10m ISK) marketing grant from the Technology Development Fund.

“We think Data Dwell has enormous growth potential and like the product offering,” Eggert Claessen, GP at Frumtak Ventures, said in a statement. Following the investment, Eggert takes a seat on the board of directors as chairman.

The company’s list of Icelandic clients includes Marel, Coca-Cola Iceland, and Vodafone Iceland. They also service Cartoon Network, and will use the capital to fund an expansion into the British market.

Data Dwell Signing Photo

From the signing. Left to right: Eggert Claessen (Frumtak), Ólafur Helgi Þorkelsson (Data Dwell), Svana Gunnarsdóttir (Frumtak), Skarphéðinn Steinþórsson (Data Dwell).

“The investment will help us grow in foreign markets, and speed up product development,” said Ólafur Helgi Þorkelsson, CEO of Data Dwell, in a statement.

Data Dwell is digital asset management software and was founded in 2012 by Ólafur Helgi Þorkelsson and Skarphéðinn Steinþórsson. It now employs nine people, and has customers in Iceland and the UK.

Norðurskautið covers the Icelandic Startup and Tech scene. Follow us on Twitter or sign up for our mailing list to keep up to date. You can also join our Slack community – http://bit.ly/slack-is

 

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The Memo: Analysing the Funding Report

I’ll start of by apologizing for the lack of Memo’s in the last two weeks! I was away in the north west of Iceland, with no access to internet. We held our first book club last week. It was pretty good — I’ll post a key take-aways post later this week. You can join the Facebook group here.

Now, on to the Memo.

Last week we published the third quarterly funding report for Iceland. Compared to both the previous two quarters we’ve analysed, and the trend in the Nordics, the numbers are bleak. I have some thoughts on what might be affecting these changes.

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Q4/2015 and Q1/2016 were anomalies 

Iceland had been starved of venture capital for some time when the three VC funds were annonced. Following that, startups that were due or overdue for funding finally got investment. We might be looking at a correction.

Compared to the Nordic region, our percentage of deployed capital and number of investments is dropping (Note: big thanks to Neil of The Nordic Web for these numbers). We’re still above our population percantage though — Iceland is about 1,3% of the Nordics population. Last quarter Iceland had ~2% of investments, and ~1% of deployed capital.

The quarters before, we were abnormally high. In Q4/’15 Iceland’s share of invested capital was 12,5%. In Q1/’16 our share of deployed capital dropped to 3,7%. Substantially lower than before, but still almost 3x our population share.

One insightful comment on the report was by Neil Murray of The Nordic Web. He said that “four investments would’ve been a strong quarter [for Iceland] two years ago.” His point suggests that we’re looking at a correction.

Lack of foreign investment

This passing quarter was unlike the two previous quarters, that both had relatively large investments from foreign investors. NEA’s $30m investment in CCP and Glu Mobile’s convertible note issued to Plain Vanilla gave Q4/15 and Q1/16 a good boost, respectively.

This time around, the biggest investment was Icelandic, and although we did see some foreign activity (foreign angels participated in 3Z’s $400K seed round) it wasn’t at the scale we saw earlier.

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Seasonality

Iceland is one of those places where big chunks of the society slow down during summer. Investments might be a part of this slow down. We don’t have data for previous Q2’s, which makes us unable to corraborate this theory.

Lack of available capital

While I’ve written previously that we might be heading into VC problems (part one,part two), the funds still have almost $20m available that we expect will be used in fresh investments. The problems I foresee won’t materialise for several more quarters. Therefore, I highly doubt that lack of capital was in issue.

Why do you think we saw this drop in investments? Is there something I’m missing? Send me a message and share your thoughts. Full anonymity if you want.

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