Wise Startup Blog

In an effort to showcase the great startups and give them an opportunity to showcase their product, I’ve begun contacting (and receiving) startups to be interviewed for the Wise Startup Blog, and we have our first entry, Kaplak.

Kaplak is an online distribution platform for digital content creators operating in the “very slim end” of the long tail (ie videos of rare flower pruning). They take your content, put it into a digestable widget/link/etc. and then find the niche online publishers to distribute your product. They split revenues with the online publisher, the content owner, and Kaplak. Kaplak is owned and developed by Morten Blaabjerg and is based in Denmark.

In one sentence, what does your startup do?

Kaplak helps producers of digital materials and products on “the slim end of the long tail” find online distribution.

Tell us how you got started.

Kaplak is an offshoot of a wiki I started in 2003, Crewscut.com. Crewscut was originally meant to be an online platform to host the films and projects of Crews Cut Production, which was a loosely organized association of people connected to and around a handful of my film and television projects.
 
There was a lot happening in those years, which was reflected in our work on the wiki. Lawrence Lessig gave a talk at our university, which made quite an impression. I and my study mate Søren Falgaard discovered Wikipedia and discussed it intensely. YouTube started in 2004 and was quickly taking off. There was a lot of things which dawned on me re: online ownership and digital distribution. Napster was closed, but I used AudioGalaxy a lot, as long as it lasted - and discovered also the world of bittorrent, through the swedish torrent-indexing site The Pirate Bay. In short, I or we had what Lessig later called an “awakening”. Still, there were lots of problems, but they paled in comparison with the dreary system I knew from the offline world : work applying for funds for a film project, having other people decide for you, create the film, and then dreary work to get the film out on TV, in theatres or at film festivals, none of which paid the food on my table, if it even managed to get on. Now, I could watch people in Japan or Greece download my films directly via p2p. I felt I watched the beginning of a new era. Still, I didn’t get paid, but there was a lot less hazzle, and I had total freedom and control. At the same time downloads for my Civilization II scenarios skyrocketed to the 1000s of downloads, in many different countries. I felt there was a demand for what not just I did, but for many of the otherwise obscure things which were not previously accessible to people.
 
Kaplak was born out of all this, as a business to deliver fast, convenient distribution of files, and an easy method to finance distribution as well as production costs. In 2006 we presented our first sketchy business plan, but not before 2007 did I begin to put serious work behind Kaplak. The name for the company came up during a discussion between myself and my first business partner Jesper Böttzauw, who had a law school degree as well as a sailor’s background. I described the economic incentives model for carrying a product message across our network, and he said “That’s called kaplak”.
 

Can you describe your team?

Kaplak today consists of myself, Morten Blaabjerg, CEO, and developers Anders Nicolaisen and Jesper Beltoft Lund, who are busy working on Kaplak’s first pre-alpha build. Mikkel Christensen delivers hosting for our sites. We also have a really strong network of advisors, of which some are rooted in high tech/VC and business development environments, and others in HR, coaching and online communities. We still have unfilled roles in our team, and are looking to fill at least two more seats this year.

What’s been the hardest obstacle you’ve had to overcome with your startup?

There are many problems. One of the hardest things for us (and others who want to dive into this market), is to educate our market and customers, so to speak, as well as our advisors and investors. Thus, a core element of our long term business strategy is to create awareness of online opportunities, how the economy online works, and how every one of us have the power to create our own online architectures and communities. This is already happening, but there’s a lot of people who have not yet discovered this, and are not using it to it’s full potential. This explains why we lay so great emphasis on our blog and developing a great online infrastructure of connected platforms. We need to reach out to many different groups of people and let them discover us and the knowledge base we’re slowly building.
 
We mean to cultivate the “slim end” of the long tail, and this means we need great volume to earn money, for us, and for our customers. We can’t grow sufficient volume if we rely only on people who are online and actively engaged in online activities today - which, roughly speaking, are students, entrepreneurs, geeks and old people. These groups have much more spare time on their hands than people with daytime jobs, and so tend to be able to contribute more to online activities. We need the potent group of working adults to engage, and we can do this only if we can offer financially sound and easy methods for these people to sustain life while doing it.
 
We need to get all this offline stuff online, and create a financially sound model which provides further incentives to put more good offline stuff online, and make more people aware that this is in fact possible and that it can actually bring in a supplementary income.
 
One of the hardest “bumps” for me personally was the split with Jesper, which grew out of our different understandings of what the internet is. I’ve written about it earlier here, but in short, it was very hard to realize that I’ve chosen the wrong partner. What we liked about our partnership and each other was also a destructive cocktail when put into the company, but I am thankful we learned this so early in the process.

Have you raised any money? Are you looking to raise money?

Our most precious ressource right now is time. We’ve got lots and lots to do, but not everything can be sped up by adding money. We have very little capital right now, and for the time we’re thankful for it, as we also have a very low cash burnrate and few committments, which mean we are free to act and react very swiftly. I am not impressed when I see other startups who manage to find half a million DKK from an angel, which forces them to do things prematurely, IMHO. Money tends to lock things down, fix them in a form, which may constrain a startup too much for it’s own good.
 
I always stress the fact that we have no rush in Kaplak. There’s no “first mover” advantages in a new market, which we perceive our market to be. In fact, I believe we need more competitors, and look forward to it, as we all share a common interest in capturing the favor of our customers and delivering prime services to them. We’ll have slightly different perspectives on what the challenges and issues are, and therefore our products will also offer different solutions, and I’d like to see what other companies can come up with.
 
We’re currently in our first phase of business development, and while we have a very low burnrate, we do look for and need one or more angel investors. But we’re very careful to select the right ones, who ”get” us, and are capable of delivering more than just cash. We welcome serious inquiries at morten@kaplak.com.
 
We’ve taken a company decision to spend 10% of our time and efforts on our financing plan, along with our online activities and development of our first build and demos. Our first phase leads to a more costly 2nd phase, which we can enter only when we’ve found sufficient capital (right now budgetted to 25 mill DKK) to scale our solution. It is also at this time, we’ll begin hiring some of the talented people, we reach out to and connect to in phase 1 :-)

Do you have any new projects to share with our readers?

We’ll have a very early build with some functionality later this year. It is a very simple widget which we may call “URLsale” or “URLecho” for the time being. It allows a user to “sell” a URL across different websites, and will distribute kaplak among users who participate in the “selling”. This widget will help demonstrate what our network will be like, although for all practical purposes it will be limited and not scalable. It will also help us get further data, when we learn how this first build is used by it’s users.

Contact Information:

Morten Blaabjerg, founder and CEO
 
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