Monday, December 31, 2012
How Experienced And Novice Programmers See Code
How Experienced And Novice Programmers See Code: Esther Schindler writes "We always talk about how programmers improve their skill by reading others' code. But the newbies aren't going to be as good at even doing that, when they start. There's some cool research underway, using eye tracking to compare how an experienced programmer looks at code compared to a novice. Seems to be early days, but worth a nod and a smile." Reader Necroman points out that if the above link is unreachable, try this one. The videos are also available on YouTube: Expert, Novice.
Read more of this story at Slashdot.
Read more of this story at Slashdot.
Study: Motivation Is More Important Than IQ For Succeeding In Math
Study: Motivation Is More Important Than IQ For Succeeding In Math: 
“While intelligence as assessed by IQ tests is important in the early stages of developing mathematical competence, motivation and study skills play a more important role in students’ subsequent growth,” says researcher Kou Murayama, in a new long-term study exploring why students succeed in math.
Looking at the progress of 3,520 students as they matured from 5th to 10th grade, Murayama finds that self-confidence and good study habits are more important than inherent intelligence.
While IQ is often considered an important trait of a good student, other research finds that self-confidence is roughly twice as predictive of learning college chemistry than SAT Scores [PDF]. As a result of this latest research, Murayama recommends that schools should focus more on the psychology of learning as the content itself. Indeed, given that nearly half of students drop out of college, motivation is certainly an overlooked factor in our education system.
“While intelligence as assessed by IQ tests is important in the early stages of developing mathematical competence, motivation and study skills play a more important role in students’ subsequent growth,” says researcher Kou Murayama, in a new long-term study exploring why students succeed in math.
Looking at the progress of 3,520 students as they matured from 5th to 10th grade, Murayama finds that self-confidence and good study habits are more important than inherent intelligence.
While IQ is often considered an important trait of a good student, other research finds that self-confidence is roughly twice as predictive of learning college chemistry than SAT Scores [PDF]. As a result of this latest research, Murayama recommends that schools should focus more on the psychology of learning as the content itself. Indeed, given that nearly half of students drop out of college, motivation is certainly an overlooked factor in our education system.
Expedia Buys Majority Stake In European Hotel Search Site Trivago For $632 Million
Expedia Buys Majority Stake In European Hotel Search Site Trivago For $632 Million: 
Online travel giant Expedia announced this morning that it will acquire a majority stake in Trivago, the Dusseldorf, Germany-based hotel search and price comparison site.
In a regulatory filing, Expedia said it will pay a total of about €477 million Euro, which is approximately $632 million in US dollars, in exchange for a 61.6 percent share of Trivago. €434 million of the deal is in cash, and €43 million is in Expedia stock. The deal is expected to close in the first half of 2013, pending regulatory approval.
Expedia, which is traded on the NASDAQ stock market, has a valuation of approximately $8 billion.
It’s a very good turnout for Trivago, which was founded seven years ago and has grown into an extremely popular — and profitable — hotel room search site for the European market and beyond. Trivago operates in 30 countries and expects to exceed €100 million in net revenue for 2012, according to a press release issued regarding the Expedia deal.
Today’s deal also seems to show a nice boost in valuation for the company since its last funding round. In the spring of 2011, Trivago sold a 25 percent stake to late-stage venture capital firm Insight Venture Partners for a reported €40 million – that’s an overall valuation of €160 million Euro. Today’s stake sale valued the entire company at nearly €800 million.
Online travel giant Expedia announced this morning that it will acquire a majority stake in Trivago, the Dusseldorf, Germany-based hotel search and price comparison site.
In a regulatory filing, Expedia said it will pay a total of about €477 million Euro, which is approximately $632 million in US dollars, in exchange for a 61.6 percent share of Trivago. €434 million of the deal is in cash, and €43 million is in Expedia stock. The deal is expected to close in the first half of 2013, pending regulatory approval.
Expedia, which is traded on the NASDAQ stock market, has a valuation of approximately $8 billion.
It’s a very good turnout for Trivago, which was founded seven years ago and has grown into an extremely popular — and profitable — hotel room search site for the European market and beyond. Trivago operates in 30 countries and expects to exceed €100 million in net revenue for 2012, according to a press release issued regarding the Expedia deal.
Today’s deal also seems to show a nice boost in valuation for the company since its last funding round. In the spring of 2011, Trivago sold a 25 percent stake to late-stage venture capital firm Insight Venture Partners for a reported €40 million – that’s an overall valuation of €160 million Euro. Today’s stake sale valued the entire company at nearly €800 million.
The Hardest Logic Puzzle Ever (and How to Solve It)
The Hardest Logic Puzzle Ever (and How to Solve It):
It's that strange time of year, the lull between Christmas and New Year, when you're not really celebrating but not really working either. So, how about you wrap your brain around the world's hardest logic puzzle to keep yourself amused? Y'know, just for fun. More »
Thursday, November 8, 2012
Smart Drone Can Autonomously Avoid Obstacles [VIDEO]
Smart Drone Can Autonomously Avoid Obstacles [VIDEO]:
One of the biggest issues with robotic planes or helicopters, also known as drones, is that they are not very good at avoiding obstacles on their own. In other words, they need a human pilot on the ground to prevent them from crashing. But that could change soon.
Researchers at Cornell University have developed software that, coupled with a camera and hardware that mimics a brain, helps a small drone to dodge obstacles like trees or poles.
The software makes the drone turn an image taken with its camera into a 3D model of the environment. The robotic brain can then determine which objects are obstacles and change its route accordingly. This wou…
Continue reading...
More About: drone, popular science, robots
One of the biggest issues with robotic planes or helicopters, also known as drones, is that they are not very good at avoiding obstacles on their own. In other words, they need a human pilot on the ground to prevent them from crashing. But that could change soon.
Researchers at Cornell University have developed software that, coupled with a camera and hardware that mimics a brain, helps a small drone to dodge obstacles like trees or poles.
The software makes the drone turn an image taken with its camera into a 3D model of the environment. The robotic brain can then determine which objects are obstacles and change its route accordingly. This wou…
Continue reading...
More About: drone, popular science, robots
Tuesday, October 16, 2012
Sunday, October 14, 2012
Saturday, October 13, 2012
Angel Investors Do Make Money, Data Shows 2.5X Returns Overall
Angel Investors Do Make Money, Data Shows 2.5X Returns Overall: 
Editor’s note: Robert Wiltbank, PhD, is a professor at Willamette University, where he and Wade Brooks run an angel investing fund managed by second-year MBA students. He is on the board of the Angel Resource Institute, and is a partner with Montlake Capital (a late stage growth capital fund) and with Revenue Capital Management (a royalty based lender). He’s c0-authored two books and many academic articles.
I began studying angel investing returns about 10 years ago as a result of a problem I couldn’t resolve: The investing world seemed certain that angel investors were rubes. Conventional wisdom dictated that they made reckless investments in very early-stage ventures mostly doomed to fail. And whenever they might come close to succeeding, savvy “professional” investors would just swoop in, cram them down, and win the real returns. In addition, angels were up against a selection problem: All the best entrepreneurs and opportunities would naturally gravitate to the best venture capital funds, leaving only the “scraps” for angel investors.
So which is it? Are angel investors just unwitting philanthropists or legitimate entrepreneurial investors?
Through research backed by the Kauffman Foundation, NESTA (a UK-based entrepreneurship foundation), the University of Washington, and Willamette University, I’ve compiled the largest data set on angel investor financial returns that exists. The angel investors I was spending time with didn’t seem so naïve or incompetent. While not professional investors, most angels are very successful in their own right, overwhelmingly as a result of their own entrepreneurial endeavors. Their firsthand knowledge of creating new businesses and new markets seemed quite relevant to successfully investing in other entrepreneurs working to do the same.
The best estimate of overall angel investor returns from this data is 2.5 times their investment, though in any one investment the odds of a positive return are less than 50 percent. This is absolutely competitive with venture capital returns.
The interest in Andy Rachleff’s article suggesting that angel investors don’t make money has been extensive. The piece is thought-provoking and makes several really good points. First, everyone should understand that angel investing is high-risk investing; it really is a “homerun” game like formal venture capital investing. Second, a portfolio of investments, even in angel investing, is a great approach. Third, whenever you’re making risky investments it is a great principle to limit your bet size and make sure that you don’t put too much of your wealth into aggressive positions. Valuable lessons learned from Andy’s personal experience venture investing in Silicon Valley.
Fortunately there is now good data on angel returns in Silicon Valley and nationally, and while more research is certainly needed, the data suggest that angel investors can and often do make money. Of course there are more and less capable angel investors, just as with formal VCs, but as a group they are definitely not unwitting philanthropists. They appear to generate credible returns as entrepreneurial investors.
With this data, we don’t need to make deductions from the experience of venture capitalists. Andy says: “If the average VC fund barely makes money, and seed investments represent even less compelling opportunities than the ones pursued by venture capital firms, then the typical return for angels must be atrocious.” Only they’re not. Deductions like this are problematic because early-stage venture investing does not happen in an efficient market. Angel investors often act differently than VCs, and the fact that VCs abandoned seed-stage investing doesn’t necessarily mean they did so because seed investments are inherently less compelling. (A plausible alternative explanation of why VCs backed out of seed stage investing is as a consequence of a growth in fund size, NOT a reduction in the number of compelling opportunities at the seed stages.)
Let’s take a look at the actual data. (If you are big into data, you can read two reports detailing the data collection efforts in both the U.S. and the U.K., as well as a more detailed description of the distribution of outcomes: Kauffman Foundation Angel Returns Study and NESTA Angel Investing Study. In addition to those two practitioner reports, you can read a more formal academic paper on how entrepreneurial expertise influences the returns experienced by angel investors.]
The overall multiple from the data represented in the graph is 2.5 times the angel investment (i.e. $100,000 invested, would return $250,000). It is based on more than 1,200 exited investments made by angel investors over a 15-year timeframe, collected separately across both North America and England. It is not highly concentrated geographically, or in the bubble of 1998-2000, or in any industry. The distribution of returns from the different U.S. and UK samples is virtually identical — a useful robustness check on the initial North American data. There are no “carried value” estimates in the data. (If you want more detail on these things, you can go crazy in the full reports.)
Here are some important things to note:
But before we get too far away from hard data, over the last year or two the Angel Resource Institute (ARI) has been building the HALO Report, a quarterly report on group angel investor activity in the U.S. The data on valuations, activity levels, geographic and industry distribution is quite interesting, and over time, this will provide a quarterly gauge on angel investment returns, as well. For the first half of this year, valuations aren’t outlandish, at about $2.7 million pre-money, and round sizes are right around $550K, spread throughout a variety of industries. The picture again seems more representative of angels as legitimate entrepreneurial investors. It’s also worth noting that angel investing is spread more widely throughout the country than formal venture capital; it’s not highly concentrated in the Bay Area.
To keep things in perspective, it’s important to remember that most ventures, even great ones, don’t ever take venture capital investment. A little less than one-third of IPOs are of venture capital-backed firms. While this is really impressive given that VCs invest in less than 1 percent of new ventures, it still means that two out of every three IPOs are of companies that never had any venture capital investors. Angel investors, like savvy entrepreneurs, don’t necessarily view raising formal venture capital investment as a measure of success.
No one celebrates taking out a loan, but for some reason some people like to celebrate taking on venture investment. Best case: equity investment (whether angel or VC) is a tremendous asset with a commensurate financial obligation. Worst case: it’s an albatross around your neck…with a commensurate financial obligation.
Just like angel investors, VCs want their money back — times 50 if they can get it. The idea that angels are suckers while VCs have cornered the market on building great companies is simply not supported by the data. Now let’s get back to the business of selling more product and less stock!
Editor’s note: Robert Wiltbank, PhD, is a professor at Willamette University, where he and Wade Brooks run an angel investing fund managed by second-year MBA students. He is on the board of the Angel Resource Institute, and is a partner with Montlake Capital (a late stage growth capital fund) and with Revenue Capital Management (a royalty based lender). He’s c0-authored two books and many academic articles.
I began studying angel investing returns about 10 years ago as a result of a problem I couldn’t resolve: The investing world seemed certain that angel investors were rubes. Conventional wisdom dictated that they made reckless investments in very early-stage ventures mostly doomed to fail. And whenever they might come close to succeeding, savvy “professional” investors would just swoop in, cram them down, and win the real returns. In addition, angels were up against a selection problem: All the best entrepreneurs and opportunities would naturally gravitate to the best venture capital funds, leaving only the “scraps” for angel investors.
So which is it? Are angel investors just unwitting philanthropists or legitimate entrepreneurial investors?
Through research backed by the Kauffman Foundation, NESTA (a UK-based entrepreneurship foundation), the University of Washington, and Willamette University, I’ve compiled the largest data set on angel investor financial returns that exists. The angel investors I was spending time with didn’t seem so naïve or incompetent. While not professional investors, most angels are very successful in their own right, overwhelmingly as a result of their own entrepreneurial endeavors. Their firsthand knowledge of creating new businesses and new markets seemed quite relevant to successfully investing in other entrepreneurs working to do the same.
The best estimate of overall angel investor returns from this data is 2.5 times their investment, though in any one investment the odds of a positive return are less than 50 percent. This is absolutely competitive with venture capital returns.
The interest in Andy Rachleff’s article suggesting that angel investors don’t make money has been extensive. The piece is thought-provoking and makes several really good points. First, everyone should understand that angel investing is high-risk investing; it really is a “homerun” game like formal venture capital investing. Second, a portfolio of investments, even in angel investing, is a great approach. Third, whenever you’re making risky investments it is a great principle to limit your bet size and make sure that you don’t put too much of your wealth into aggressive positions. Valuable lessons learned from Andy’s personal experience venture investing in Silicon Valley.
Fortunately there is now good data on angel returns in Silicon Valley and nationally, and while more research is certainly needed, the data suggest that angel investors can and often do make money. Of course there are more and less capable angel investors, just as with formal VCs, but as a group they are definitely not unwitting philanthropists. They appear to generate credible returns as entrepreneurial investors.
With this data, we don’t need to make deductions from the experience of venture capitalists. Andy says: “If the average VC fund barely makes money, and seed investments represent even less compelling opportunities than the ones pursued by venture capital firms, then the typical return for angels must be atrocious.” Only they’re not. Deductions like this are problematic because early-stage venture investing does not happen in an efficient market. Angel investors often act differently than VCs, and the fact that VCs abandoned seed-stage investing doesn’t necessarily mean they did so because seed investments are inherently less compelling. (A plausible alternative explanation of why VCs backed out of seed stage investing is as a consequence of a growth in fund size, NOT a reduction in the number of compelling opportunities at the seed stages.)
Let’s take a look at the actual data. (If you are big into data, you can read two reports detailing the data collection efforts in both the U.S. and the U.K., as well as a more detailed description of the distribution of outcomes: Kauffman Foundation Angel Returns Study and NESTA Angel Investing Study. In addition to those two practitioner reports, you can read a more formal academic paper on how entrepreneurial expertise influences the returns experienced by angel investors.]
The overall multiple from the data represented in the graph is 2.5 times the angel investment (i.e. $100,000 invested, would return $250,000). It is based on more than 1,200 exited investments made by angel investors over a 15-year timeframe, collected separately across both North America and England. It is not highly concentrated geographically, or in the bubble of 1998-2000, or in any industry. The distribution of returns from the different U.S. and UK samples is virtually identical — a useful robustness check on the initial North American data. There are no “carried value” estimates in the data. (If you want more detail on these things, you can go crazy in the full reports.)
Here are some important things to note:
- In any ONE investment, an angel investor is more likely than not to lose their money, i.e. to earn less than a 1X return. It is risky. However, once investors had a portfolio of at least six investments, their median return exceeded 1X. Irving Ebert, of the Ottawa Angels, has done some outstanding Monte Carlo simulation with this data, finding that making near 50 investments approximates the overall return at the 95th percentile. Most investors will be somewhere in the middle, of course. Angel investors probably should look to make at least a dozen investments, but that’s just a rule of thumb. This is critical: Each investment has to be done as though it’s your only one; the bar can’t be lowered to enable you to more quickly build a bad portfolio.
- The production of cash is highly concentrated in winners; 90 percent of all the cash returns are produced by 10 percent of the exits. This is essentially the same concentration as in venture capital. The next largest “bucket” of cash returns is in the high-volume, but low-multiple group, the 1X to 5X category. It’s important to note, however, that it’s not exactly the same as formal venture capital. These returns happened all over the place geographically (NOT all in the Bay Area or Boston), happened across industries, and most often happened without having any follow-on investment from VCs. In fact, VCs eventually invested in only one out of three of the ventures, and the ventures in which they did invest produced lower returns than those where VCs did not invest.
- When you aggregate all of the data, these angel investors (across the U.S. and UK) produced a gross multiple of 2.5X their investment, in a mean time of about four years. This return is absolutely competitive with formal venture capital returns. Because the margin of error around these estimates is larger than that from the venture source and venture expert data, I won’t assert that angels “outperform” formal VCs. But to assume that they are fooling themselves about making money in angel investing is simply unsupported by the data.
But before we get too far away from hard data, over the last year or two the Angel Resource Institute (ARI) has been building the HALO Report, a quarterly report on group angel investor activity in the U.S. The data on valuations, activity levels, geographic and industry distribution is quite interesting, and over time, this will provide a quarterly gauge on angel investment returns, as well. For the first half of this year, valuations aren’t outlandish, at about $2.7 million pre-money, and round sizes are right around $550K, spread throughout a variety of industries. The picture again seems more representative of angels as legitimate entrepreneurial investors. It’s also worth noting that angel investing is spread more widely throughout the country than formal venture capital; it’s not highly concentrated in the Bay Area.
To keep things in perspective, it’s important to remember that most ventures, even great ones, don’t ever take venture capital investment. A little less than one-third of IPOs are of venture capital-backed firms. While this is really impressive given that VCs invest in less than 1 percent of new ventures, it still means that two out of every three IPOs are of companies that never had any venture capital investors. Angel investors, like savvy entrepreneurs, don’t necessarily view raising formal venture capital investment as a measure of success.
No one celebrates taking out a loan, but for some reason some people like to celebrate taking on venture investment. Best case: equity investment (whether angel or VC) is a tremendous asset with a commensurate financial obligation. Worst case: it’s an albatross around your neck…with a commensurate financial obligation.
Just like angel investors, VCs want their money back — times 50 if they can get it. The idea that angels are suckers while VCs have cornered the market on building great companies is simply not supported by the data. Now let’s get back to the business of selling more product and less stock!
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