Startup One Stop

Good morning, All,

When you’re starting a company, everyone tells you what to do – put together a deck, talk to customers, talk to investors. We’ve seen the lists ad nauseam, but what about a list of what not to do?

1. Produce a product or technology that no one wants. It’s called ‘buy-in’ because the idea is to get people to buy. 2. Not have a revenue model from Day One. You might not implement it immediate – but it better be there. 3. Spend all of your time fundraising and not enough time on developing your product 4. Build a pitch instead of a business 5. Listen to investors, chapter and verse. We all go to pitch panels and get investor feedback. Question: how many times have you attended one such event, heard an investor sing the praises of the company - and witness him/her write a check, or heard that they wrote a check not long afterwards? Thought so. 6. Not listen to investors. Some do know what they’re talking about. We know both of them. 7. Think that sales and marketing are not as important as product development. Every chair needs at least three legs to support it. 8. Lack the determination and resolve to realize your dreams. 9. Start a company for the wrong reasons – your product is cool, but is it compelling? And are you the one to do it? Know your strengths and limitations. 10. Give up too easily: of course it’s hard to do – if it were easy, everyone would do it 11. Not have a clear message or product. We go to a lot of pitching events. Half the time, we’re not sure what the company is about – and neither are the investors. Do one thing and do it well. And be able to describe it. 12. Have a grabber. Example: BMW – the Ultimate Driving Machine. FedEx: When it absolutely, positively has to be there overnight. Clear. Simple. Effective. Multibillion dollar company – and they got there almost overnight. Be memorable. Read More...

Good morning, All,

We’ve heard it ad nauseam: the VC model is broken. There is certainly no shortage of posts on the subject. At TechCrunch Disrupt, Fred Wilson called the VCs sheep, saying they all wait, then jump into a deal together, usually when it’s too late. Most VCs, said Fred, are not forward looking. Question: do they really know the industry?

Investors are usually: 1. Entrepreneurs who made good 2. Entrepreneurs who got lucky (right company at the right time – early hires as opposed to key players: we know a junior project manager who went to a startup. It was her second job out of school; eighteen months later, the company was acquired and she was a multimillionaire before her 25^th birthday) 3. Investors who invested well or again, were in the right place at the right time. 4. Those born with lucky sperm; no experience required. Read More...

Good morning, All,

Is it OK for multimillionaires like Zach Braff to panhandle for money on Kickstarter? “Crowdfunding has helped countless creative projects get off the ground, but if we continue to allow it to be hijacked by the rich and famous there will be no chance left for the little guy,” the piece begins. Remember: donors get nothing; if the film is successful, the producers get yet another opportunity to show up at a restaurant and take that table that you’d been waiting an hour for. Braff already had a financing deal in place. But he felt it was more important to take the $25 from that kid in Brooklyn. He’s disrupting the Hollywood system. We understand that. He’s also disrupting a system that might otherwise produce the next Stanley Kubrick – someone whose vision is so far afield, it’s way beyond the scope of the traditional Hollywood financing clique. How long will it take before a Shawn Fanning or an Evan Williams decide to launch their next startup through kickstarter? Would that not diminish the chances of an unknown with a possible groundbreaking technology?

Speaking of disrupting systems, we attended TechCrunch Disrupt this past week, and saw a number of companies exhibiting who had gotten their start through kickstarter programs. Meanwhile, investors on the panels seven floors north of them were complaining that there were no more big ideas. We did note that, after the investors finished their panels, they disappeared. We didn’t see them mingling among the startups. Hard to notice something that starts as a speck on the landscape, from an ivory tower. They’re looking for the next Jack Dorsey or Evan Williams, meaning, they’re waiting to see what Jack Dorsey or Evan Williams come up with next and honestly, how many groundbreaking ideas can one person or two people come up with, after all? Cuil and Color had A teams. Yet Cuil lost millions – not Cuil, and Color disappeared before ever really launching, leaving many an investor (they raised $41m) in the red on that deal. Which, in all fairness, is a Color, too. Read More...

Good morning, All,

Above you’ll notice that we have our first sponsored ad. If you find the service useful (they can help build your Minimum Viable Product), please do support a fellow SOS members and thank you so much!

We personally do not own a tablet/iPad. We do consider them from time to time: they’re infinitely portable - we spend a lot of time on the move. But they do not offer the most important functions we need available on a computer, so came to the conclusion that it’s a half computer – pass, and claims of the death of the computer are wholly premature. Read More...

Good morning, All,

First, you’ll notice that we have our first sponsored ad – it’s one our SOS members! So, if you’ve been looking forever for a technical cofounder to help you build your MVP, click on the banner above, get it done, and support a fellow member and this newsletter!  And thank you so much!

We are aware that we do spend a lot of time here talking about the importance of revenue models, so we shelved it for a bit. The big news in New York tech recently was that Foursquare raised a $41m round and released a new version of its iOS app as well.  The round was mostly a loan to keep the company afloat. The release of the new version of the app was meant to deflect the less-than-stellar funding announcement. Read More...

Good morning, All,

We wrote a different editorial, before yesterday’s Boston bombings. It feels inappropriate to post it today. As someone who lives in a city that also suffered an attacked, I know how difficult it is and how incomprehensible it feels. Our hearts go out to the city of Boston and to those who were affected by the violence of yesterday’s events. Here is the link to Google’s Boston person finder and we sincerely hope that you and yours are safe. What struck us is that, amid the horror and the mayhem of yesterday’s bombings, and despite the uncertainty of not knowing whether more bombs would go off (several more were later found, undetonated), people ran towards the screams to help their fellow man. Nothing justifies an act of such wanton violence, and in the horror of such sudden devastation, one would think that the first reaction would be to flee. That did not happen yesterday in Copley Square.

It was the day of the Boston Marathon: Patriot’s Day, commemorating the start of the American Revolution, and a day when strangers come together to cheer on strangers. Yesterday, strangers came together to help strangers. Doctors who were there to treat dehydration treated wounds and performed triage. Marathon runners changed course and ran towards hospitals to donate blood. In a civilized society, humanity prevails. And we will hopefully go onward and forward, taking steps to ensure that this does not happen again to more people and to other families. Read More...

Good morning, All,

Two things: first, a warning: college graduation is just around the corner and that means that a new crop of Millenials are heading our way. They’re not all the same although if you believe that the recent unemployment numbers have humbled the supremely entitled among them at all, newsflash: contrary to popular misconception on the part of many a millennial and in all fairness, not all, technical literacy does not fast-track you to the corner office. Oh, and you had me at hello: ‘unlimited days off and free lunches’ in the startup world? Not that we’ve noticed and while we’re on the subject, can we not pretend that we live in a parallel universe that revolves around each and every one of us?

Ok, we’ve steered clear of ‘Lean In,’ to date and full disclosure: we haven’t read the book, nor do we intend to. We’ve have seen the platitudes and – going for the money shot: has it occurred to anyone else that Ms. Sandberg was having her Marissa Mayer Moment here, meaning, she’d been the go-to example of the Successful Woman in Tech, keynoting and being quoted ad nauseam but was somehow not tapped to be the CEO of Yahoo! We recently attended a panel discussion where the keynote was a representative from the Lean In movement. We were curious about the movement’s next steps and what they were planning to further empower women, but she talked about herself and her career. The audience was predominantly women and yet no words of advice for the room. No game plan mentioned. See conclusion of the above paragraph. Read More...

Good morning, All,

Let’s all take a breath. Meaning, take a brief overview of what’s been going on lately: 1. A 17 year-old’s company was bought by Yahoo! for $30 million. Revenue: $0 Downloads: 1 million+. The app was disabled the day of the acquisition. Then there are the facts of the story that were not reported in this ‘remarkable’ story. Reality check: young Summly founder Nick d’Aloisio’s dad is a VP at Morgan Stanley. His mother is an attorney for a very prestigious law firm. Which helps to explain why Yoko Ono, Wendy Deng, Stephen Fry, Ashton Kutcher, Li Ka-shing, and other investors were so quick to fund it. He wasn’t just some kid coding from his bedroom in Wimbledon. 2. Y-Combinator just graduated its latest class of copycats startups: 47 companies, down from 66. Investors were unimpressed. 47? Really??? How do you mentor/accelerator 47 companies in 3 months without defying the laws of physics and common sense? 3. Because of asset seizures, I am starting my new company outside California. Has to do with California’s Prop 30, to help fund the state’s budget, and the retroactive tax. “This is not a tax,” writes Bryan Goldberg. “This is an asset seizure plain and simple. It is no different than when Hugo Chavez used the benign-sounding ‘nationalize’ to describe his seizure of private property in Venezuela.” This, while Cali’s public sector employees get private sector wages and then some: Alameda County official to retire with $400K yearly ($423,664 for life, to be exact). @bgoldberg: I'm leaving California. Will take bad weather over bad government...

Many public sector employees are now earning higher salaries than their private sector counterparts, while the technology that we create as entrepreneurs have certainly helped to curtail our privacy. Open government is a popular term but beware of newspeak. When California passed Prop 30 to help balance the state budget and aid education (we’re always suspicious when we hear that one: a lot of laws are enacted and taxes levied in the name of education. At this point, the US must have the most state of the art schools in the world, not to mention the best-educated students, but such is not the case), was it to allow public officials to retire on more than the President himself earns? If governments are going to reach into our pockets to pay outrageous retirement packages of so-called public servants, time to cap those packages, too. Which can also be made retroactive: the precedence is there, and thank you, Prop 30. Read More...

Good morning, All,

The twitterverse went wild last week over what was basically an act of immaturity that spiraled out of control, thanks to social media. In brief: Adria Richards (SendGrid) was offended by a (perceived) sexual joke having to do with a “dongle” and “forking,” which she overheard at a developer conference. Instead of confronting the developer, she took a picture of him, then shamed him on Twitter and in her blog post. DongleGate was born. They both got fired. Once again, the power of the Internet and the amplification brought about via social media got some people in trouble.

Newsflash: most guy tell each other off color jokes (last week’s Grey’s Anatomy featured a prank in which one doctor had another doctor unwittingly page a patient named Jenna Talia. No one was fired. The show was not cancelled). Didn't it occur to her that rather than report it to the twitterverse, she could have turned around and talked to them. She was fired but not before SendGrid was taken offline by Anonymous for a few hours (but not PlayHaven, although the brogrammer was fired as well). Everyone was wrong and everyone missed the forest through the trees last week: that CISPA (Cyber Intelligence Sharing and Protection Act) has reared its ugly head once again. If passed, it would destroy online privacy in the United States, by allowing private companies to share virtually any information about you with the government, and vice versa. Which basically also gives private companies carte blanche to listen in on your conversations/emails, etc as well. We saw what happened when Adria Richards basically invaded that developers private conversation: that was a warning shot and that was just a taste of what could very well potentially come about. Time to keep your focus on Congress and not the Ministry of Silly Walks or we’re going to all lose that element that makes this industry great: that we enable free speech, and have no compunctions about marching to the beat of a different drummer. Let’s keep it that way. Latest petition is here. You have your marching orders. Onward and forward. Read More...

Good morning, All,

Short and sweet today. We read a lot of blog posts and articles, many of which offer advice to entrepreneurs and we’ve boiled it down to 5 simple points. It’s a short list and alliteration always makes it easier to remember:

1. Passion: you’ve got to have that fire in the belly – that thing that keeps you up at night. Starting a venture is hard. Having that passion for what you’re doing is what helps to keep you going. 2. Purpose/Problem. It’s that thing that you’ve set about to solve. That void you’re trying to fill; that pain point that you’re attempting to eliminate. That’s also four P words, which shows you how critical this point is. 3. People: your team, your mentors, your advisors, your investors. Having the wrong people on your team can bring everything to a grinding halt. Trust me on this one. 4. Process/Plan. To get from point A to point B, you need a plan. One foot in front of the other: figure out your roadmap before you set out on your journey. Of course you’ll hit some bumps in the road. Have a backup plan/alternative route. 5. Profits. There used to be a panel series called ‘Show Me the Money,’ where startups would pitch to investors in hopes of getting funded. Remember: works both ways. Have a path or profitability. Read More...