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Bug Labs (initial review)
 I went to a real interesting dinner tonight in San Francisco, to get introduced to a New York-based startup, Bug Labs, along with Ryan Block of Engadget, Robert Scoble and Jerry Michalski.  We met with their CEO, Peter Semmelhack, and their San Francisco-based consultant, Jeremy Toemann. Dinner was at Le Colonial in San Francisco.
I'll try first to list the pieces of what it is, in the same style as the What Twitter Is piece I wrote a few days ago, with the understanding that this will be less thought out since I've known about the company for a very short period of time.
1. It's an architecture for pluggable gadget components. There's a hardware interface, which I know little or nothing about (I'm a software guy). It was explained to me as "60 pins" -- they said they interface all the capabilities of the chip, whatever that means. But at a software level, each of the components interfaces with XML over HTTP. It's as if they read my mind. The pieces are all fractional horsepower HTTP servers. They are using RESTful interfaces everywhere. I haven't actually seen the XML, let's hope it's simple.
2. The designs for the components that Bug Labs is doing themselves are all open source. They're sharing everything. So they won't have any kind of lock in on the devices that are built with it. They asked if we thought they should connect with Stallman. I said of course.
3. There have a very sexy development platform which we saw screen shots of, but didn't actually see running. The users design the hardware products they want. They can share the designs, and code, or sell it if they want. My guess is that it'll be mostly shared. It's a powerful idea, and I believe very soon, realistic.
4. And there's the hardware itself. Again, we didn't see it, they showed us wood mockups, giving an idea of how the pieces fit together. They're going to ship with four initial components, a screen, GPS, a CPU, and ??? Every unit comes with wifi and USB. I'm sure I missed a lot of the details, I think I did get the gestalt.
 Backing comes from Union Square Ventures (yet another of their deals, they seem to be everywhere) -- Fred Wilson told me about it at our lunch a couple of weeks ago. Also investing is Robert Young of Red Hat. There may be other investors (probably are). I really poked around during the dinner, said some challenging things, and it seems Semmehack's head is screwed on tight and his heart is in the right place. He didn't get rattled. He knows he may just be teaching his competitor's users what to ask for. He doesn't expect the major consumer electronics companies to get behind it. They are thinking small at first, which is great, because at first the opportunity will be small.
I'm really glad someone is doing this. I anticipated it in my second How To Make Money On The Internet piece in early 2001, but I didn't expect it would actually happen so soon. Once again Fred Wilson impresses with his willingness to bet on big ideas.
2/13/01: "Every product that has an embedded computer will shift to user design. Today's companies become fulfillment houses, building products on contract. Manufacturing margins will shrink, the real value will be in the insight -- this is what people want now -- and the risk taken that today few manufacturers seem willing to take."
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Last update: Thursday, June 3, 2010; 4:01:20 PM
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