Startup One Stop

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...

Good morning, All,

We’re hosting a panel on accelerators this week, let’s talk about accelerators. We mentor at ER Accelerator, and always attend the hospitality events that precede Deadline Day to talk to potentials. The question that always comes up: Is it worth the equity they’d be giving up for a rather small amount of seed investment. Ah, but then there are the intangibles that you may not be aware of: 1. There are mentors who are well known investors/industry luminaries who come in for an afternoon to talk to you – both as a group, to give you an overview – and then one on one. Invaluable, especially since they often return on Demo Day to catch your pitch, and you already have something of a relationship with them that’s much more than a warm introduction. 2. There are mentors who are subject matter experts who really work with you to shape your presentation – and introduce you to potential partners/clients. You often have access to them for far longer than just an afternoon, they’re also there on Demo Day, and some of them even end up investing in the companies they’ve been mentoring. Didn’t see that one coming, did you? Some even invest before Demo Day, or introduce you to potential clients/investors who do. 3. Sessions generally run for three months – which means that you’re in very close quarters with your investors, qua, the people running the accelerator. They get to know you and your product inside and out, and they don’t disappear after Demo Day: they’re always there to help you. 4. Camaraderie/help you get from other companies in your ‘class’ – and they don’t forget you after the session is over 5. Of course, your pitch and deck are shaped up and made investor-ready, 6. The weekly ‘practice pitches, ‘ with invited guests present who are either investors or subject matter experts – and their input is invaluable – and some of them might also be a potential investor/client of yours. 7. If/when you get stuck, subject matter experts are brought in to help you. 8. Companies from previously classes come to the pitch sessions – and they might have contact/clients/affiliates for you as well. 9. It doesn’t end once your 3 months are up: the accelerators have a vested interest in you; they get to know you well; and they’re always there for you when you need them 10. Demo Day – the investors and the press come to you.

Because of the mentors/support system in place at the accelerators, it’s not unusual for startups there to have clients/revenue even before they hit demo day. Not bad for a 3-month program, eh? Think of it as a startup school: a crash course in how to build a business, where they pay you to attend – and of course there’s a trade off: that’s the bit of equity they take, and they’ve earned it. Not every company succeeds, but isn’t that always the case. Is it for you? That’s your call. Each one has its own sweet spots, so don’t put all of your eggs in one basket – and there are plenty of accelerators out there, so if you don't get into the first one, next. Because we always go - onward and forward. Read More...

Good morning, All,

Two weeks ago, Marissa Mayer issued a directive that Yahoo would no longer be permitted to work from home and it caused quite a stir. “Speed and quality are often sacrificed when we work from home. We need to be one Yahoo!, and that starts with physically being together,” the memo, which was generated by the head of HR, read. Deadline: June 1^st. Comply or else. Many Yahoos!, some of whom were hired as remote employees, felt it harsh, and so leaked the confidential memo. Yahoo’ers themselves were chiming in that there were remote employees who were busy starting their own companies – on Yahoo’s dime – and others who’d been working remotely for so long, they’d been forgotten and hadn’t done any work in ages. Yahoo’s employee rolls have certainly grown bloated over the years and what better way to tell where the dead weight is than by requiring people to come into the office to do their jobs. Without having to announce layoffs. Brilliant.

Working remotely has long been part of the promise of the Technology Age: that we would also be so connected, there would be no reason for a physical office. Many early-stage startups depend on such an arrangement: but even startups don’t run remotely forever. Most large SV-based companies require employees to come to the office, whether or not the policy is stated. Why do you think perks include on-premises dry cleaners, doctors, dentists, free lunch, childcare: it’s so that you don’t have an excuse not to come in. Read More...

Good morning, All,

They’re called angels for a reason: there you are, more or less unproven as an entrepreneur, attempting to get your company off the ground and all you seem to hit are brick walls. Suddenly, an early stage investor appears, as if from above, and your whole world changes: you’re enterprise now has a fighting chance. But how do you get to them?

There’s the angel list, of course, and the New York Angels and the Arc Angels. Angels tend to show up at events, too – especially pitch events, if you know who they are and how to approach them. Another idea? Bring on an advisor or two who are subject matter experts, and if you can, find ones who have been successful entrepreneurs. Keep them involved and updated. Prove yourself and one of them might well turn into your angel. A bit of history: contrary to popular misconception, Tony Hsieh did not found Zappos. It was Nick Swinmurn, who was not having an easy time of it getting his venture going, and was introduced to Hsieh, who’d just sold his company, LinkExchange, to Microsoft. Hsieh came on as an investor and eventually, the two became co-CEOs. By the time Amazon acquired the company in 2009 for $1.2 billion, Hsieh was CEO and Swinmurn Founder, and doubt that he’s complaining. Read More...

Good morning, All,

Yes, there are three categories:

Entrepreneurs build businesses Read More...

Good morning, All,

So said Kelley Boyd, who spoke at our first SOS speaker event of the year (The Lean Movement: What You Need to Do – And Why You Probably Won’t Do It.) It really was a great presentation (sorry we didn’t record it – but we will try to have a video available for our next event, for those of you in far-off places). It was only one of the many points she covered, and although she didn’t cover this one until the end, we’re glad it was there, her point being that people talk the talk, because they can’t walk the walk. Try to be better coordinated: you learned how to walk and talk by the time you were, what, two? Apply those principles to your business and maybe, just maybe, you won't fall down.

We work in an industry rife with people who fake it till they make it. In fact, it’s a mantra for many - and it detracts from us all. In any other industry they were be marked as scammers or grifters. Or people who don’t fully understand their space and the possible repercussions of what they’re building (privacy? That’s sooo 90s. NOT). Trust me: I’ve learned a lot since founding bonniefoods. A lot of our products are gluten free – a very popular buzz word these days and a category that has made many a johnny-come-lately wealthy. All well and good, but gluten-free bakers have replaced wheat flour with rice flour and potato starch and consider: would you sit down to snack on a bowl of mashed potatoes and rice topped with sugar, chocolate and nuts? We don’t use rice flour and potato starch as a wheat replacement BECAUSE THEY’RE NOT A HEALTHY COMBINATION, not to mention that they’re higher in carbohydrates than is wheat – and a type 2 epidemic waiting to happen. Read More...

Good morning, All,

We will not be attending SxSW this year. Unless you have a reason to be there, save your money and your energy. Last year we had lunch with Brian Cohen (New York Angels) upon his return and he asked why we hadn’t attended. “Why did I need to be there?” I asked. “Because we were all there,” he answered, meaning investors.

It’s true. They are all there. So, if you do decide to go, how do you make the most of it? And this is more or less a general checklist for any conference that goes over several days, like Social Media Week, which is coming up this month in ten cities around the world, and which we will attend. Remember: neither is a sprint. Both are marathons: Read More...