The Post Money Value

Gnomedex 6.0 - Really walking the talk

There is a trend around the conference circuit with things like Camps, unconferences, etc, that all are trying to promote two way conversation, no panels, no speakers, rather session leaders or whatever.  Lots of good attempts to try and get everyone to participate and avoid the one way lectures from the podium.

At Gnomedex virtually all of the session leaders paid the 400 bucks for the conference.  A few egos didn’t (you know who you are) and enjoyed the included food, drink, t-shirts, etc, but the vast majority paid just like anybody else who wanted to show up.

What’s remarkable about this small gesture on the part of the people who are leading conversations is the difference it makes with respect to interaction which goes on throughout the conference.  While a bit hard to explain, you can see/hear and generally feel that people (for the most part) drop the ego stuff and learn from each other.

It is an interesting challenge, getting the popular (okay, A listers) to pay when they are a part of the show.  Ponzi and Chris have done an excellent job of pulling this off.  Well done.

Gnomedex 6.0 - Notable Quotes

Just a small sampling of what’s flying around.

“That’s a bad opinion to have”

                                    Michael Arrington, in response to a, well, an opinion expressed from the audience

“Most people don’t want to put their balls in one vise.”

                                    Marc Cantor, telling Dave Dederer why he hates Apple’s itunes and developer programs.

 

“Osama Bin Laden is using the Internet to issue his latest terrorist death threats and the government is worried about people uploading and sharing music. What’s wrong with this picture?”

                                     Dave Dederer on the government regulating the Internet.

A sign of the future

I’m working with one of my CEOs who is off camping. Got this note just now:

“I’m at the campground. No cell phone coverage, but WiFi works great, go figure, I’ll skype you later.”

 

Gnomedex 6.0 - Post 1

I’m here at Gmonedex 6.0 which is being held in Seattle.  Chris Pirillo and his partner Ponzi are the hosts doing a great job. 

Some good things if you decide to do a conference:

1. Badges with names on both sides. Sounds simple but when you have these lanyard type badges hanging around you neck, it’s nice to not have to worry about the stupid thing flipping so you can’t see who you are talking to.

2. A pre-conference get together. It’s always nice to meet new folks and see old friends. Again, simple thing, but really adds value.

The morning events are just getting started.  Like all conferences, I suppose, you have the group of “A” types wanting to be seen with other “A” types.  The good news is that at Gnomedex, people tend to keep the egos in check a bit more then at other conferences. 

More later.  If you are here, please stop by and say hello. I’m the only guy in a yellow polo shirt, go figure.

And for something completely fun

OverheardinNewYork is a pretty funny site. Lots of people submitting things they’ve overhead while all over New York.

As the Mac/PC wars continue, we have this tidbit:

“Dad on cell: Hi, Sammy. How was school today?...Uh huh, what did you do in computers?...What do you mean, you had to show three pictures?...And you were able to do it?...You use Macs in school, right?...Yeah, it's an Apple. A Mac is an Apple...You know that's different than the computer you use at home...Yeah, it's a different operating system...Well, I'm glad you were able to do it. Let me talk to Mommy.

--Acela Express train”

Fun site, thanks Paul.

Another place to have some start up fun

Microsoft’s Don Dodge has a good post about Microsoft’s Unified Communications Plans, including some NYT quotes and a link to the product road map press release (here). On the press release page are some other good links to resources.

Why you should care.

Let’s assume you can’t stand Microsoft, Redmond, Windows, etc, etc. That’s fine but if you are thinking about this space, you still should pay attention to what these folks are saying for these reasons.

1. They are doing the heavy lifting when it comes to user education. Having you voice mails in your email in box or having your email read via your voice mail, etc, does have lots of advantages and possibilities for improvements in productivity as well as opportunities for new businesses. With Microsoft throwing the PR/Marketing machine at this, lots of people who don’t know VoIP from Chicken Salad, will starting understanding what all this stuff is about.

2. Desktops, Desktops, Desktops.  MS shipping better client code and apps that allow this stuff to work better helps. Today, I think Windows Live Messenger does not offer a better experience then Skype when it comes to voice or video. Sorry, Robert (oh wait, he is alumni now!) but it just doesn’t. However, lots of people who try Windows Live Messenger and don’t like the experience, head to Skype or some other option. Happens all the time. Somebody says “If you like that, you’ll love Skype.” How that applies to you? Simple. Microsoft will deploy code which will educate people and millions of desktops will have plumbing and an opportunity for you to ship something better.

3. An unblemished record for shipping DIY kits. Sharepoint, Live Communications Server, etc, etc, all are not out of the box solutions, they require partners, integrators, and solution providers to make this stuff actually do something.  The closest MS have ever come to an out of the box “install.exe” type solution was Small Business Server which attempted to pull a bunch of this stuff together to allow for a somewhat install it and go solution. Not a top of the sales chart winner which is too bad because it is a really good product.  How this applies to you? Eco-system opportunities galore. Assuming MSFT does what they say and starts hawking this, the world will need integrators and others to make it work. 

4. Holes, Verticals, and add ons.  Never once have I seen an enterprise solution come out of Microsoft that was perfect, no other features required, one size fits all, nothing else to add.  While some say there may be zero opportunities for VC level businesses come out of this, there are tons of opportunities for snappy developers to grab an MSDN kit and start coding away.

Love em or Hate em, those crazy kids in Redmond are helping to crank up the noise on Unified Communications which means opportunities for you.

Doing your homework, really

Every VC who blogs says the exact same thing: Read my blog, see what we invest in, get to know the hot buttons, etc, etc.  Yet, last week I got a pitch that started out with love your blog, we have a new drug that needs 100 million dollars in passive money.  <sigh>.  Cue the “soft no”.

Then, on the other hand, along comes one hit right out of the park.

Meet Bill Hornbeck, CEO, StreamerNet Corporation.

Here is the introduction from his email:

“Rick-

I was thinking about reaching out to [name removed], then I passed through your blog, and mostly reaffirmed my belief that the only way to legitimize an "attempt to contact" is through a legitimate, personal referral. But, I am from the old school, laden with optimism and perseverance…so here goes:

(1) I never worked for Microsoft (but I watched Bill grow up while I worked for WordStar)

(2) I wasn’t in the Air Force (but I was second candidate for the Air Force Academy)

(3) I never had the pleasure of working for Chapters, but I sure appreciate e-commerce (I tried working for a bookstore as a kid, but they wouldn’t let me read)”

Perfect.  Wanted some feedback on his product, talk about things we are doing in other portfolio companies, etc.

He did homework so right to the top of the call back, come on down pile he goes.

Do your homework as it does get appreciated.

 

VC - Looking under the hood

Over the past couple of months, I’ve had a steady increase in the number of 30 minute, no harm, no foul meetings with start ups, people thinking about doing a start up and people diving in to the murky world of trying to raise capital.

I try to do more listening then talking while at the same time answering as many questions as I can. 

One of the more frequent questions that pop up is:

“How can you tell if a VC will be ‘right’ for our company?”

Here’s a synopsis of the answer I’ve been giving to people.

There are, of course, the obvious things.

1. References.

I suggest you get the names of the C level folks of current/past investments. On the surface, you might think that most portfolio companies are going to be “politically correct” when giving you feedback. Actually, once the money is in, it has been my experience that you get fairly good data.  The real key is asking these types of questions:

– How much do they know about your space?

– What happens when they disagree with strategy? 

– Describe a typical debate?

– What are board meetings like in terms of being productive?

The second set of references you should get are some of the limited partners who have invested in the fund. It’s an interesting way to get a perspective on the due diligence done with respect to the venture firm.

I’ve gotten some feedback that said a number of VCs ‘don’t do references’ and my only response to that would be, there you go, all you need to know about the firm.

2. Playback.

Most of the time when I am looking at a company, I will at some point, give a presentation to the potential investment’s C level guys about what I think I heard, what I think the vision is, and what I believe the story is.  In effect, it is a reverse pitch. I pitch the C level team on the opportunity for several reasons:

– They get to see me in the ‘hot’ seat. It’s not much but it is always nice to be on the other side listening to somebody suck up to you!

– They can see if I get it. In the spirit of Brad Feld’s cough up more mistakes, I’ve screwed this up more times then I’d like to admit.  I’ve listened, studied, and gone back to the team with my version of the Kool-Aid, only do get it really wrong.  It’s embarrassing, somewhat, but more importantly, it allows all of us to immediately see if I’m in sync or trying to be the poster child for “dumb” money.

– They get a sense of what I view is important, a priority, the revenue source, timing, etc.  This is important because nothing gets a founder more annoyed then to get a check and, a week later, have a board meeting to discuss changing the strategy.  I’ve had my share of folks in my office livid over this scenario, trust me, it happens all the time.  This happens because people tend to gloss over that paragraph in the term sheet about agreeing on strategy.  Get the VC to play it back to you, i.e. get the potential investor to ‘pitch’ you on what they’ve heard. 

Finally, don’t get trapped in a time crunch.  There are some amazing people out there who truly love what they are doing with respect to Venture Capital and start ups. Guys/Gals like Ann Winblad, Fred Wilson, Brad Feld, Jeff Clavier, Peter Rip, Jeff Nolan, and others, will give you the most important thing you can get besides money. Time.  In addition, guys like Don Dodge over at the mighty M, are also generous with time.  Reach out to these folks, and others, to gain valuable feedback on this part of the process. It will be well worth your time.

Start early, keep potential investors updated with meaningful progress reports and enjoy the ride. While some people view raising capital as just above getting teeth drilled, I would observe that there are lots of us out here that don’t subscribe to all the nonsense and hoop jumping rather: we just love companies.

Give us a call.

note: I don’t have links to the people mentioned cuz this is on the RIM, sorry.

Do you have a need for speed?

This might do it.

The Jeff Jarvis Conference - Sponsored by Dell

In Japan, they have conferences for everything.  So, it only made sense to have a conference about and/or for Jeff Jarvis. Of course, it only makes sense to have a sponsor and the only sponsor worthy of Jeff would be Dell computing.

And what better way to honor Jeff?  Exactly, explode a laptop during the conference and have it burn, live, for all to see:

Okay, maybe it wasn’t a Jarvis conference, fine, a minor detail as it was a Dell laptop.

Full story here. I got it via Gizmodo here.

Side note: It is possible it was just the power brick that blew up with somebody being oopsie on what plugs in where? Somebody keep a time log of how long it take Dell to tell everybody what actually happened.

[This space reserved for Dell to provide answer(s)]

A UNIX Question

I was reading a couple of university research papers and on the credits, I’ve seen this type of entry:

{darse,burch,davidson,holte,jonathan,terence,duane}@cs.ualberta.ca

A dumb Unix question for the world.  Using non-outlook for email, is this a legal format for an email address? It seems to me that this would be pretty handy if you could do this on the TO line as a shortcut to send mail to a group of people at one location and get it parsed and dealt with.

Todays VC email tip

I enjoy getting email from entrepreneurs, reading about great ideas and, hopefully, finding some good things to invest in.

You’ve read, probably, blog postings about VCs not signing NDAs, Confidentiality Agreements, etc.  By and large, mostly true enough but that’s not the point of this blog entry.

Lately, I seem to be getting an increasing amount of email with business plans or financials or large power point presentations. They either come with an NDA or a separate piece of mail comes later with an NDA.

Here’s my suggestion: If you want to send me (or any VC I’d imagine) an NDA first, you will get the standard response for that particular firm.  Sending the NDA with the materials, in most cases, will probably either get the whole email dumped/deleted or the plan will be read and ‘thanks but I don’t sign NDAs’ will follow.

I don’t know if somebody out there suggested this as some type of slip stream legal protection or what, but it really makes you look kinda goofy and (according to some legal folks I asked) not going to do whatever you are trying to accomplish. 

Not a good tactic.

A Seth Godin Moment in Norway

Here’s an street sign from Bergen, Norway from the good folks at 7–11.

I’m not 100% positive, but I don’t believe I’ve ever seen a naked couple hawking a chicken hot dog in North America.  It probably says something really deep about culture differences (and ad agencies) between various countries but I’m not that deep or marketing smart. Clearly, this is a job for Seth Godin or possibly Hugh.

On the other side of the street, you had some folks in fish market wanting to make sure that you felt comfortable with how you speak and what money you’d like to use.

Marketing, it’s not just a job, it’s an adventure!

 

The Scoble Start Up Lessons for You

The world already knows that Robert Scoble is leaving Microsoft. The number of blog entries with opinions on him, the move, Microsoft, etc are numerous and varied.   Hit technorati, icerocket, or any other gathering of blog data and get your fill.

I’d like to just offer up some observations and things you can get out of this as you start to grow your own company.

As observed by Paul, this really does make a larger point about blogs, the blogosphere, than the individual.  For you, this means a few things.

Anybody can become ‘a Scoble’ (or Amanda, or Tara).

You need to remember this with respect to the people you hire. The ability for anyone to create “Brand Me” requires you to go beyond paying lip service to ‘the team.’  As you build the team for your start up, make it a team, a true team.  Some smart words and a bit of a following opens up opportunities to people that simply didn’t exist as little as 4 years ago.  Your job as a CEO when it comes to nurturing, encouraging, and managing your team is even more critical today than before.

Assume they blog and assume they will leave. 

The days of people working for a single company for life (or 10+ years) are basically gone.  Lay down a common sense blogging policy (to wit: use common sense) and simply stay out of it. Fire somebody for revealing confidential information, being a racist, etc, but beyond the ‘common sense’ part, steer clear.  And when they leave (they will), wish them the best, have them start the company alumni association, and remember popular bloggers who move on, will still do the “When I used to work at/for…” stuff so being nice, respectful, etc, will have an lingering (and hopefully positive) impact on your little corner of the world.

Share with the rest of the class.

If you go back and look carefully at some of the posts Robert did when there was something a bit controversial, Robert seemed to be able to get information, pass it on and encourage others to share.  If you are having a bad quarter, tell your team. If there is a product issue/delay, etc, share with the team. Having your team feel like they know only helps the company.  When you have to announce a delay in shipping a product, a hard drive crash or system outage, tell your team the truth and let them use common sense. Some people will be goofy, others with just get it wrong but that’s okay. It puts the human face on the company and nothing, in my opinion, is more important to a young company’s growth then the human face of the company.  People generally want others to succeed and if they feel like they know you, they will root for you.  It’s probably the single most important lesson you can get out of the Microsoft/Scoble ride; make it personal.

Read what they write and learn something.

This might look like advice to read/watch your team’s blogs with respect to the company. Nope. Read to learn more about the people. Again, if you look at Robert’s postings regarding travel, the equipment he used, bi-weekly schleaps to see his son, etc, you would have a road map inside the man on a lots of hot buttons/issues.  If you pulled the last 12 months worth of blog entries, you’d have a slam dunk on how to ‘keep’ the guy, beyond the obvious (more money). 

As a completely hypothetical example, meaning no disrespect to Microsoft or Scoble’s bosses as well as having zero inside knowledge, here’s a possible plan which might have kept the guy happy while at the same time giving Microsoft additional mileage. Suspend corporate nonsense for a second, assume he is valuable, etc, etc.

First, the bi-weekly trips to California. Lay up. Cover some costs straight up by simply giving him an office in the SV building and suggesting he spend some Channel 9 time doing Video Blogging on cool companies using MSFT technology. (again don’t analyze this, start the paid shill stuff, this is a management thing). Cover his commute costs, rental car and some allowance for a place to stay.  On the passion for technology. Lay up. Simply give the guy 20 grand a year to buy new stuff and blog about it.  On the travel/speaking all over the place. Lay Up. Instead of following corporate ‘policy’ with a corporate American Express card, have the Microsoft machine talk with Amex (of which Microsoft is a major client) and get him either Platinum level perks or get him a platinum card. Why? Two for one business travel, use of lounges, etc, etc.  Put a little arm twisting on Amex to get the guy some extra perks.

Now, again, I made all of this up but they are out of the box suggestions based upon reading Robert’s blog for the personal stuff.  My point here is you can (and should) do the same for your own team.  There are hundreds of clues people put out there and many of the things you can do will be low cost with extremely high impact.

So, the big guy is off to SV. I wish Robert, his lovely wife/partner Maryam, and his pretty/smart kiddo Patrick all the happiness in the world.  Enjoy the ride, Robert, enjoy the ride.

EOS Airlines - Low Cost Perks for High Impact

I had a chance to fly EOS Airlines round trip.  EOS airlines are the folks that put 48 people in a plane designed for hundreds (Boeing 757). They have the upgraded sleeper seats/pods (the original British Airways units upgraded with better bedding, space, etc) and the basic sales pitch is designed to have you fly pretty much International First Class for a price that can be cheaper then business class fare on the major airlines which fly the JFK/London route.

As you would expect, this was an amazing flight with super comfortable sleeper seats, airline food that definitely was anything but (outstanding, in a word), and top notch people.  The experience was 5 star, without question.

The airline was founded by  Dave Spurlock, former Director of Strategy at British Airways. Mr. Spurlock combined his many years of experience with a really solid understanding of what customers truly want.  There are some great lessons in EOS for your start up.

What people want to see vs. what they actually want.

A long time ago, while on a cruise ship, I overheard a lady talking about the midnight buffet. Her comments were “I don’t want to actually eat anything that late, heavens no, I just want to see it.”

EOS figured this one out as well.  Being able to brag about it, but not actually use it, becomes a very powerful (and cheap) form of advertising as well as brand enhancement. 

Consider these small examples.

We arrived at JFK earlier then required through a series of unthinkable occurrences. Air Canada was 20 minutes early into NJ and the traffic from Newark’s airport to JFK was almost non-existent; go figure. Anyway, we were met by somebody outside the entrance door to the terminal who promptly escorted us less then 30 yards to the check in desk. After looking at the passports and doing all the formalities, the counter personal mentioned that the lounge was not open yet but we should take advance of Mr. Wang who would be delighted to give us a complimentary shoe shine while we wait. We could then come back up and get escorted to the security formalities and then up to the lounge.  While we declined both offers and said we could find the lounge ourselves, I went off and checked out Mr. Wang (I might have the name wrong..) and his shoe shine activities.  Downstairs, I watched a colorful gentlemen greeting customers and probably setting the high water mark for solid service while getting your shoes cleaned up.  He mentioned he gets one or two customers a day from EOS, usually businessmen, always nice.

The cost was basically nothing to EOS (20 bucks, maybe), almost nobody (2 out of 48) used the service, EOS claims a ‘first class’ amenity and while talking about EOS on the plane, a couple of businessmen proudly mentioned it as a perk separating EOS from British Airways. Not bad for a twenty.

Inside the Stansted Lounge, passengers are offered unlimited free phone calls to the US from the lounge and EOS makes a point of walking around telling each passenger, emphasizing the words unlimited and free. Now, to those of us living in the Echo Chamber, this is instantly obvious (i.e. a VOIP offering) and the multiple Cisco IP phones around the lounge made it clear (to me) how that perk was being offered.  But, the vast major of the world is not in the Echo Chamber so imagine the looks and talk while the lounge attendant walked around mentioning to each guest this service was available.  British Airways (and Virgin Atlantic) travelers who were trying EOS for the first time were blown away by a service costing pennies.  Of course while I was there, nobody used the service (except me to check my voice mail) so even if it was a cheap discount long distance line/service, the cost was minimal for the benefits (customer reaction) received.

Diet Vanilla Coke. It was in the fridge.  Again, no change in cost to have the guys stock Dr. Pepper/Coke/Pepsi or Diet Vanilla Coke.  The impact?  A customer saying to another, “Cool, these guys are awesome. Have you seen the crappy selections in the American Airlines lounge?”  Diet Vanilla Coke and customers are high fiving the company.

For you and your start up, the lesson (and challenge) should be clear. Besides the core product or service, find the perks people will love, especially if they just want to know it is there.  People love to brag about your cool stuff, so at every possible place, give them a chance.

Busting out of the Echo Chamber

Like Robert Scoble, I’d also encourage you to read this posting from my good friend Nicole Simon. What’s interesting about the timing of her post/Robert’s comments is that I’m sitting in the breakfast room of the First Hotel Marin, here in Bergen, Norway.

As I’m zipping through the blog feeds, a nice elderly women and her husband (from Finland) sitting next to me, asks me about the Tablet PC I have and, of all things Microsoft Office. It seems she wanted to get a new computer but, like Nicole, didn’t feel like much software/services were really for her. She wanted to see if I would show her Gmail (she heard google mail was nice) so she could talk to her grand kids.  When you are elderly, you can ask for anything.  I spent a few minutes showing her. She mentioned, a couple of times, things about technology being too much english and not enough what people in Europe (Finland) wanted.  It was interesting.

From Nicole:

“Flickr? Well, the interface is not in German, so why use it instead of some nicer German websites? Yahoo and all those web Web 2.0 applications? All of them focused on the American market. On the english market. Why use them / talk about them etc when you alianate us from the start?”

and

“Oh and in case you cared: Germany has about 82 million inhibitants, as well as other countries around it speaking German. We do have money too.”

There a ton of opportunities out here folks. The siren song of “the Valley”, the American market, etc, is a strong one and a potentially rich one, but there are customers in every country, looking for your solution tailored to them.

Read Nicole’s full piece, it’s a good one.

JobLoft.com - Egos check at the door

I got a nice email from Chris Nguyen who started up jobloft.com in Canada. It was a polite/to the point note about what he was doing with some others, a little 3 minute elevator pitch, etc, etc.  I know, yet another job board, nothing much left in the space, etc, etc.  Well, could be, but that isn’t the point of telling you about Jobloft.

Actually, I’m more interested in Chris.

Chris opened his email with:

“My name is Chris Nguyen and I recently launched a new web 2.0 job board with 3 other Ryerson University students”

His signature block?

“Chris Nguyen
 Corporate Account Manager, JobLoft.com”

No ego. Co-Founder, doing sales, you gotta love that.  I know nothing about Jobloft.com but I already like Chris and I’m sure I’ll enjoy meeting him because entrepreneurs like Chris deserve at least a meeting. 

The title might not get him funded from me or anybody else, but it does send a good opening message.

So when you are cranking up the Chairman, President, CEO and ruler for life business card, remember; it is not about the title.

Latte in Lofoten

So far, a little placed called Bacalao, here in Svolvaer, Norway has the best Latte I've found. It is a wonderful day here. We are waiting for the Hurtigruten Boat that will take us along the coast.

There is internet everywhere, no surprise, with open wireless points (at least 6 where I am sitting) everywhere.

Some uploads and Reboot data when I hit the boat tonight and fire up the Edge/EVDO card.

Let the new renaissance begin (Reboot8)

Thanks to a nice lady who stopped me from walking to Stockholm, I’m in the building and listening Reboot8 speakers. I’ll try to give you some information and commentary as we go along. 500 folks are here which is nice crowd.

The intro of Reboot8 contained a fairly good comment about knocking off the buzz words.  The Web 2.0 phrase? Not gonna be used here. And it was “thank you CMP” for reminding us to stay away from buzz words. So, no Tim shot.

More coming.

On the ground in Denmark

I'm here in Copenhagen (along with still buggy tooth) getting ready for reboot.

When I travel, I like to go native, so to speak, because I get a much better feel for what is happening vs. taking cabs around or staying at the american chain hotels.

One intersting observation I've been watching is the difference between how various cultures deal with english. Here in Denmark 'everybody' speaks english and probably one other language besides the native language.

I've watched a whole bunch of tourists in many places start off with 'do you speak english' in an attempt to get help or whatever. So far, here in Denmark nobody appears to take this step, rather they dive in with english. Americans, Arabs, Japan's fine folk, doesn't matter. I've stuck to the more polite (IMO) do you speak english and get a usual, of course. That of course is almost like I should know better. Stills seems polite to me and an interesting cultural observation.

Changing money. There is the not so new tactic of screaming no commission on the 10,000 money exchange places. What amazes me are the sheer number of tourists who don't realize the exchange rates are different between the commission free places and if you are changing a few coins it does add up. But the lure of 'Free' sucks em in, I guess.

More later but for now, I just off at the wrong bus stop so I will be practicing 'I'm lost' in Danish...

------------------------------------------------------ Rick Segal, Partner, JLA Ventures rick@jlaventures.com +1 416.367.2279