Top 10 Startups of 2010

Diaspora: The Anti-Facebook, Crowdfunded

When ReadWriteWeb first covered Diaspora in May, the group of 4 NYU students were raising money via Kickstarter to fund their idea for an alternative to Facebook. Diaspora sought to build an open-source, decentralized social network, one that respected users’ privacy. Continued dust-ups this year over Facebook and privacy, along with the fact that Diaspora’s challenge to Facebook simply made for a compelling story, gave the group a lot of press.

Within days of ReadWriteWeb’s first story, the funds raised via Kickstarter skyrocketed from $8000, just shy of its $10,000 to almost $200,000 from over 6000 backers. Diaspora released the first version of the developer code in September, and launched in private alpha in late November. The expectations for Diaspora were set quite high, with all the buzz and funding it received, and while those may be difficult to meet, Diaspora certainly represents the power of crowd funding, as well as an interest in making sure the social Web is not centralized in one company.

Hipmunk: The Power of a Good User Experience

Oftentimes we put up with painful experiences as consumers simply because there are no good alternatives, and we can lull ourselves into thinking that those unsatisfactory ways of doing things are just “how things are done.” So when I first heard about Hipmunk, an airline flight search engine, I wondered “Why?” There are already many ways to search online, ways to bid for your tickets – albeit none of them great. But it’s better, I suppose, than dealing with an airline directly.

But one look at Hipmunk – even better, one search via Hipmunk – and you can see how smart entrepreneurs can enter an already-crowded space and disrupt it with a great user interface and a great user experience. Rather than forcing you to click through pages of results to find the right flight, Hipmunk gives you the results on one page and allows you to have a pretty granular level of control over exactly the things that make a flight feasible for you – price, time of day, number of stops, for example.

LearnBoost: Bringing the Teacher Gradebook to the Web with Open Source

Like Hipmunk, LearnBoost is tackling a space that may not be particularly sexy – Web-based classroom administration tools. But tracking grades and attendance is an important, if not cumbersome, responsibility of teachers, many of whom still use the paper-and-pencil gradebook for record-keeping. In fact, LearnBoost co-founder and CEO Rafael Corrales sees that paper gradebook as the startup’s main competitor, and so LearnBoost has built a product that is not just beautiful but incredibly easy to use. LearnBoost seems to really understand educators’ needs, something that is incredibly important in education technology. LearnBoost is free, it supports data portability, and it integrates with Google Apps, for example, and the company has been very responsive since launching in August to update the product to suit the needs of those using it.

But LearnBoost doesn’t just receive kudos for its work in education technology. The company has been a leader in developing a variety of open-source tools, including Mongoose for storage, Soda for acceptance testing, and Socket.io for real-time communication. For a new company, LearnBoost has an impressive following on GitHub.

Square: The Future of Money is Mobile

We may be slightly cheating to squeeze this one into a 2010 list, as Square, the brainchild of Twitter co-founder Jack Dorsey, allows you to accept and pay via physical credit cards using a card swiper that plugs into the headphone jack of your mobile device. The hardware and app are free, but Square takes a small cut of each transaction.

Square spent most of 2010 in private beta and had its share of hardware and security problems, but the addition to the team in August of Paypal veteran Keith Rabois marked a big win for the company. Square now says it’s processing millions of dollars of mobile transactions per week, and boasts some avid users – small businesses and independent merchants who are looking for an easy and mobile way to manage credit card transactions.

InDinero: The Mint.com of Young Entrepreneurs

Describing a startup as the “Mint.com” of something felt like one of the most overused phrases in pitches in 2010. But in the case of InDinero, the description actually works, as the company really does aim to provide a similar sort of real-time financial dashboard to small businesses. Unlike traditional accounting software, InDinero is easy to set-up and use, and the analytics it offers provides small businesses with a wealth of important data.

But a nod to InDinero isn’t simply recognition that the company addresses an important business need or that it has gathered impressive traction – and funding – since launching this summer. It’s a nod to co-founder Jessica Mah, who founded her first Internet startup at age 13, entered the University of California, Berkeley at age 15 to study computer science, and now at age 20, is the CEO and architect of a profitable Internet company. Yes, of course, all the startups in this list were founded by incredibly smart and talented entrepreneurs, but Mah is particularly inspiring.

Selecting 10 top startups for 2010 was not an easy task. Do you agree with our assessments? Did we miss anyone? Let us know in the comments who you think should – or shouldn’t – make the list.

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