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Y Combinator Funding Application

Winter 2010 Application deadline: 10 pm (PST) October 26, 2009.

Please try to answer each question in less than 120 words.

We look at online demos only for the most promising applications, so don't skimp on the application because you're relying on a good demo.

We do usually look at the video. Submitting one greatly improves your chances.

Though we don't make any formal promise about secrecy, we will try to avoid disclosing your plans to potential competitors.

We recommend you save regularly by clicking on the update button at the bottom of this page. Otherwise you may lose work if we restart the server.

Your YC username:


Company name:

Seeing Interactive, Inc.

Company url, if any:

YC usernames of all founders, including you, lloydarmbrust, separated by spaces. (That's usernames, not given names: "bksmith," not "Bob Smith." If the startup has 3 founders, there should be 3 words in this answer.) lloydarmbrust jnovek

YC usernames of all founders, including you, lloydarmbrust, who will live in the Bay Area January through March if we fund you. (Again, that's usernames, not given names.) lloydarmbrust jnovek

What is your company going to make?

A local business directory sold through small-town newspapers. The goal is to integrate

hyper-local community and business information into a format that users can trust in their

small towns.

The directory will be branded as the newspaper's own, allowing businesses to update their information, add photos, news, and daily specials. Consumers will be able to comment and review. Eventually businesses will be able to pick a domain name and template to have a full-fledged website with the ability to sell their products on the internet. Think the Yellow pages plus Yahoo! Merchant Solutions divided by Angie's List.

By leveraging trust that small newspapers have with their local advertisers we will create a nationwide network of businesses that feels local.

Meanwhile, we automate and streamline every news-delivery task that we possibly can. The eventual goal is to create an all-encompassing online suite of tools for small newspapers: we won't be happy until small, ailing newspapers are able to cut their workforce by 30%. Eventually we will provide the tools necessary to abandon print media altogether.

If this application is a response to a YC RFS, which one?


For each founder, please list: YC username; name; age; year, school, degree and subject for each degree; email address; personal url (if any); and present employer and title (if any). Put unfinished degrees in parens. List the main contact first. Separate founders with blank lines. Put an asterisk before the name of anyone not able to move to the Bay Area.

lloydarmbrust; Lloyd Armbrust; 28; 2006, York College, B.A. English;;; and The Texas A&M University System and Web Developer. jnovek; Jason Novek; 27; 2006, University of Minnesota Duluth, B.S. Computer Science, B.S. Mathematics;;; and Seeing Interactive and CTO.

Please tell us in one or two sentences about something impressive that each founder has built or achieved.

While running the web department for a small daily newspaper, lloydarmbrust grew page- view traffic by 850% and revenue by 400%--during that process he built a web presence that won several national awards and accomplished goals that he was told would never work at a small-town newspaper.

Nine months after starting his first job, jnovek had to ask his boss for a new set of responsibilities because he had replaced his entire daily routine with a collection of cron jobs and shell scripts.

Please tell us about the time you, lloydarmbrust, most successfully hacked some (non-computer) system to your advantage. Our very first customer wanted a contract. This customer is notoriously picky about contract terms, and a bolierplate off the internet wouldn't work. We had just spent about $3k on the incorporation process, and didn't want to drop another $2k on additional lawyer fees.

Instead, I spent twelve hours scouring the web for example web-service agreements, random contracts, and a few forms purchased from Legal Zoom. It turns out that lawyers use code just like hackers -- it felt a bit like learning PHP. Being an English major at heart, it was actually pretty fun.

At the end I had a 15-page contract. I paid the lawyer $300 to look it over, he said: "Nice. Well written. Where'd you get it?"

Please tell us about an interesting project, preferably outside of class or work, that two or more of you created together. Include urls if possible.

High school produces much that is sub-impressive. One result for us, now 12 years in the running, was the creation of an international holiday. Mind you, it is only celebrated by about 100 people--but we have met people outside of our influence, and even from other countries, who celebrate the day.

Observed on Dec. 27th and known as the "twenty-seventh" or "the new day". We created the day in response to the nonsensical notion of people being over-excited about the new year, when in fact it is just another day. Festivities include your standard revelry on the evening of Dec. 26th, followed by the collective singing of Louis Armstrong's rendition of "What a Wonderful World" to bring in the day.

How long have the founders known one another and how did you meet? Have any of the founders not met in person? 14 years and we met in high school. Lloyd is a Libra and Jason Pisces--we both enjoy long walks on the beach, and the gentle sound of the mandolin.

What's new about what you're doing? What are people forced to do now because what you plan to make doesn't exist yet? Newspapers have been operating under a failed business model for 10 years.

We're rebuilding newspapers by creating profitable web products and optimizing their sales process with online tools. This both makes money and cuts costs. What's novel is that we're saving the newspaper for their relationships with millions of local businesses, and showing them how to make money again.

What are newspapers doing without us? They are dying: http:// and that doesn't include weeklies. Our products make newspapers money and bring local communities together.

What do you understand about your business that other companies in it just don't get?

While everyone else writes off small newspapers as dead, we think that their tight-knit relationships with local businesses make them worth saving.

Although Google, Yahoo!, and Facebook are big players in advertising none of them have been able to forge relationships with small-town businesses in a big way. Those companies all seem less trustworthy to consumers and less memorable to small business owners than the local paper.

We take the trust that newspapers have earned with local businesses and use it to sell those businesses our web services.

Who are your competitors, and who might become competitors? Who do you fear most? Not Google or Yahoo. They've both tried to partner with newspapers, and never thought big enough. Facebook is a definite possibility: their biggest growth right now is coming from baby boomers. Thankfully Facebook hasn't figured out how a local online community should look, as they seem to think that business information should be displayed in the same way as profile information.

Like many YC applicants, we're most worried about other start-ups. Right now there are other start-ups working on this problem -- and they're not married, have no social life, and have been doing it for a lot longer.

How will you make money? We are already making money. Our current product grosses several thousand dollars per month in revenue.

Our most immediate source of revenue is direct from newspapers. Each newspaper pays us between several hundred and several thousand dollars for services. In the future, we will also present products directly to small businesses through newspaper ad reps in a tiered pricing scheme.

For example, the local directory product that we are currently developing will sell directly to businesses for between $20 and $200 per month and we get a cut. The customers who are buying these services are accustomed to paying $40 just to place business-card sized ads in the paper once a week, so if they are interested in marketing via the internet, this purchase should be a no-brainer. Really though, it doesn't matter what we charge: $n 6,000,000 small-business is a number we can live with.

If you've already started working on it, how long have you been working and how many lines of code (if applicable) have you written? 7 months and 2834 lines of Ruby, SQL and sh, plus a large but uncounted volume of HTML templates.

If you have an online demo, what's the url? (Please don't password protect it; just use an obscure url.) Our first product was a print-to-web conversion system that immediately generates revenue for small newspapers:

We are currently working on our next product, which is an online directory system. We do not have a demo for that right now, but we will by the time YC interviews roll around.

How long will it take before you have a prototype? A beta? A version you can charge for? Our first product is nearly ramen profitable. Although our current product is in a market that is rapidly losing value -- print to web ad conversion -- it still helps us build relationships with these newspapers and makes them money (adds about 5% to their bottom line).

Our second product is weeks away from its first release. We are launching at one of our partner newspapers on November 9th--they have already pre-sold about 50 customers to the online directory so we will have immediate revenue from that, and several of our other papers are anxious to launch as well.

If you're already incorporated, when were you? Who are the shareholders and what percent does each own? If you've had funding, how much, at what valuation(s)? We inc'd as a Texas S-Corp in March 2009 and we each own a 50% share. lloydarmbrust put in $18k for start-up costs and jnovek put in sweat--lots of it.

If you're not incorporated yet, please list the percent of the company you plan to give each founder, and anyone else you plan to give stock to. (This question is as much for you as us.)

Not applicable.

If we fund you, which of the founders will commit to working exclusively (no school, no other jobs) on this project for the next year?

Both--we don't want to become butchers or bakers, we want to be start-up founders. When

we're 80 we both hope to be starting-up something

we love this crap.

For founders who can't, why not? What level of commitment are they willing to make? Not applicable.

Do any founders have other commitments between January and May 2010 inclusive? Depending on some vacation vesting at the old job, lloydarmbrust may be tied up on the 4th or 5th of January, but if this is unacceptable we can work around it.

Do any founders have commitments in the future (e.g. finishing college, going to grad school), and if so what? Paying for food and shelter is the only thing on the table. Our commitment is to this company--we aren't some kids out of school who want to flip a start-up for quick exit and fast cash. We are serious about saving the newspaper industry and we will succeed with or without funding.

Are any of the founders covered by noncompetes or intellectual property agreements that overlap with your project? Will any be working as employees or consultants for anyone else? No. jnovek already works full-time for Seeing Interactive and lloydarmbrust will quit his current job when YCombinator starts. The YC money will be used to get lloydarmbrust running fulltime faster than we could just bootstrapping it.

Was any of your code written by someone who is not one of your founders? If so, how can you safely use it? (Open source is ok of course.) We subcontracted two developer friends to do some work for us, but we paid them for their time and we have contracts and releases saying the code is ours.

Are any of the following true? (a) You are the only founder. (b) You are a student who may return to school when the next term starts. (c) Half or more of your group can't move to the Bay Area. (d) One or more founders will keep their current jobs. (e) None of the founders are programmers. (Answering yes doesn't disqualify you. It's just to remind us to check.) No.

If you had any other ideas you considered applying with, feel free to list them. One may be something we've been waiting for. We spend so much time thinking about newspapers and local advertising, that we find that our ideas can almost always be integrated into our current goals. However, here are some annoying things that need to be fixed: a clothing recommendation engine or Zappos plus Amazon for shirts and pants; online grocery shopping application with an Amazon-style recommendation engine, ie, "it's been two weeks since you've purchased milk, do you want that added to your order?"; a search or recognition engine that matches houses or cars to a unique set of user-entered values, ie, John is a traveling salesman who wants an efficient vehicle with plenty of room to install his laptop; and a kayak-style travel search for idle corporate and private jets--both for buyers and sellers.

Please tell us something surprising or amusing that one of you has discovered. (The answer need not be related to your project.) Children are useless until around the age of three. I never thought it would take them that long to become real people.