When I meet up with Ori Allon for coffee on New York’s Lower East Side, he paid special attention to the stools. Little details like this interest him these days, because he’s in the market to buy himself a bar. Life is good for the 32 year old Israeli-born programmer, who, having sold his first company to Google and his second to Twitter, is tech's equivalent of a two time all-star. But unlike many of his peers, Allon has remained mostly out of the public eye. "Ori has always seemed happy to fly under the radar," said David Tisch, a tech investor. "But privately is well known for building amazing teams and working on big challenging visions."
In the weeks since his departure from Twitter, where Allon worked after being acquired, emails arrive daily from venture capitalists with the same basic message: "whatever you are doing next, please take our money." The key difference this time is that Allon, who has built two very technical companies acquired mostly for their algorithms, wants to put his dent in the universe, and perhaps his name in lights. "I could do another startup, build something very specific, and sell it to a larger company," says Allon. "But I’ve done that already, you know. It's not about the money. I’m ready for a different challenge. I want to build something really, really big." He's getting ready to launch his third company, Urban Compass, which today announced an $8 million seed round from big names in both tech and finance.
"Can I disrupt a very analog industry?"
Allon was a 26 year old PhD student at the University of New South Wales when he wrote the algorithm behind the Orion search engine. His insight was to index the web so that search queries returned relevant results even if those pages did not contain the literal keywords users typed in. The tech earned praise from Bill Gates, and incited a bidding war between Microsoft, Yahoo and Google. Mountain View was the victor, and the tech behind Orion eventually became a core part of how Google search works.
Allon worked at Google for four years, then left to start a new company Julpan, which analyzed the way people shared information on the social web. Microsoft was his lead investor. Again, Allon was looking at the dominant paradigm on the web — by this point social, rather than search — and taking a highly technical approach to solving big pain points in that industry. The company was acquired one year later by Twitter, which made Allon the director of its NYC engineering office. Again, Allon’s work quickly became a key component of how the service operated.
For his next startup, Allon wants to create something with more mainstream appeal. And so he is plotting what he calls a "human network", a company that will have his tech smarts as its backbone, but will solve a problem for the average consumer, not optimizing algorithms for a tech titan. "I’m interested in the Uber model," he told me. "Can I disrupt a very analog industry? Getting these industries to adopt a more efficient way of doing things is a challenge, but also a huge opportunity for us to build products that will fix what is broken and outdated. How can we remake the taxi business, or real estate, or restaurants?"
"It's not about the money."
The exact industry Urban Compass will focus on at first is still a secret, and the product is still largely under wraps, but we know a few details. It wants to help consumers "search better" and explains its business by saying, "We understand people. We understand technology. We're building a platform of hyper-local knowledge and information to help people make their most important personal decisions."
"So the main idea here is that developments in both hardware and software, mostly mobile, have made it possible to collect data and track what is happening in the real world, we call it the "offline world," in a way that was not possible in the recent past," said Allon. "Collecting the information is the first step, but creating a platform that will make this data searchable and relevant, with a real business model, is what we are excited about."
If the idea sounds a little vague, that’s because it still is. But that hasn’t stopped Allon from raising an $8 million seed round from investors like Founders Fund and Thrive Capital. The CEO of American Express, Ken Chenault, is a backer. The biggest name on the list is no doubt Goldman Sachs, notable because the investment bank almost never puts money into companies at this early stage. Allon used the hefty seed funding to recruit a cast of his favorite all-stars engineers from his old haunts to come work on this new startup.
Shifting gears to build a consumer facing company is tough. "There are a lot of these guys, especially in search, who have these very niche reputations where they're known as geniuses and Google or Microsoft or whomever poaches them," said Anil Dash, co-founder of the technology consulting firm Activate. "A lot of these guys tend to think relatively esoteric tech improvements have more consumer appeal than they do. I’m not saying that as a slam, but it's like, an improvement in one narrow area of search is a lot more appealing integrated into Google than as its own thing."
Allon is keenly aware that his past success can present its own pitfalls. "It’s a strange problem to have, but actually we turned down a lot of money." He wanted to avoid the fate of other serial entrepreneurs, like Color’s Bill Nyuyen, whose most recent project crumbled under the weight of its $41 million in financing. "Once you’ve had success with startups, fundraising can become very easy, and that can be dangerous." Urban Compass plans to launch its first product in the summer of 2013, giving us a chance to see if Allon can create a company that is known for more than being acquired.