YouNoodle: The Startup Predictor

Despite recent criticism, it is my opinion that YouNoodle is poised to be one of the most exciting startups of 2008. Currently, YouNoodle is a database and social network for projects, startups, existing companies, eager business professionals and budding entrepreneurs; however, its long-term plan is far more exciting. The two founders, Bob Goodson and Kirill Makharinsky, are developing software they like to call the "Startup Predictor," an algorithm that uses sophisticated modeling pertaining to how social capital and networks can affect an organization’s performance. Goodson was recently quoted in the New York Times as saying, "Give us some information, and we’ll give you some idea of what the company will be worth in five years.”

The founders have been extremely vague as to how different factors in the algorithm will be gathered, weighted and applied, further amplifying the anticipation. But lack of information has of course drawn an enormous amount of skepticism from bloggers, technologists and investors (especially investors). I do not discount the validity of the questions raised about YouNoodle's intended functionality. Much of the early stage investment process is more of an art than science and the startup success is highly volatile with respect to many economic and sociological factors, implying that prediction is a near impossibility.

But what if it isn't? Critics thus far have been focusing too hard on the trees and aren't seeing the forest. The Startup Predictor isn't going to replace partners and associates at venture capital firms just like automated financial models haven't replaced investment bankers. The idea is to develop technology that can provide optimal resources during the process of evaluating a company's potential. The algorithm's output will be utilized but taken with a grain of salt (If you look at Bob's words carefully he says "some idea").

If the YouNoodle Startup Predictor is even marginally successful it will be a incredible win for the venture world. So why denounce a service, especially one that could be quite useful, before having a chance to see it in action? Further, why does its outcome have to be black or white? There are certainly more than two outcomes (success or flop) for the Startup Predictor. I ask that investors and bloggers temporarily curb their cynicism until the much anticipated launch after which the technology can be properly assessed and critiqued. Until then, let's anxiously await the advent of a piece of technology that, for all we know, could make a real impact in the startup process.