Month: August 2012
I heard the word “connector” several times yesterday at the Colorado Innovation Network summit. I gave the final speech of the day after being in Chicago in the morning to give the keynote speech at the Excelerate Labs Demo Day which was an awesome group where I discovered one company I’m very interested in potentially investing in.
In both cities (Chicago and Denver) I gave a talk about Startup Communities using the Boulder Thesis as a framework. The Chicago talk was short and tight (about 15 minutes) to warm up the event. The Denver talk ended up going almost an hour and having a lot of Q&A. Both were simulating (at least to me – hopefully to the crowd) and the entrepreneurial energy in both rooms was significant.
While I missed most of the COIN summit because I was traveling back from Chicago, I caught a few of the last talks before mine. I also talked to a bunch of people and kept hearing the word “connector” come up – it must have been one of the words of the day. This was used to define a role for many of the constituents in the COIN summit which included entrepreneurs, government, university, and big company folks.
My good friend Phil Weiser, Dean of the CU Law School, introduced me to the word “convener” several years ago. CU Law, and specifically the Silicon Flatirons program that Phil created a decade ago, plays a huge convening role for the Boulder startup community. As a result, it sits in the center of a lot of activity. It’s not a connector – it’s a convener.
Government and universities, in my view around startup communities, are feeders, not leaders. Feeders are important, but they are different – and play a different role than leaders. For a startup community to be vibrant and sustainable the leaders have to be entrepreneurs. This is the first tenet of the Boulder Thesis.
A convener has much more leverage than a connector. A connector implies a lot of work and a lot of control. There’s also a hierarchical dynamic – connectors are choosing who to connect; as a result they become gatekeepers which is not the right role for a feeder. I believe most gatekeepers inhibit the growth and development of a startup community so any role that looks gatekeeper-ish is often an inhibitor to progress.
Conveners quickly develop a reputation for being inclusive and accessible. This is another tenet of the Boulder Thesis – everyone in the startup community must be inclusive to anyone who wants to engage.
I was going back and forth with a founder of a startup in Chicago this morning by email who is now eight years old (not really a startup anymore) and just rented a 60,000 foot office and is looking to help the startup community more now that it’s gotten to a meaningful size. I suggested that, among other things, they play a convener role.
Basically, all feeders to a startup community can play a convener role. It’s more powerful than simply being a connector.
A few months ago TechStars ran a program for military veterans called TechStars Patriot Boot Camp. It was powerful and well received. Since then I’ve had a few emails exchanges about the lack of veterans, especially entrepreneurs who are veterans, in Boulder. Several negative perceptions and biases arose and as the conversation continued, Taylor McLemore and Dave Cass asked if they could put a guest blog about the issue and their perspective up on this blog. I agreed and thought what they wrote up was important. It follows.
What if I told you there is a valuable group of entrepreneurs that know Boulder to be a great place for startups BUT a place that is not welcoming to them…WHAT?…”our Boulder. No way!”
This past summer, I worked with David Cohen, Tom Chickoore and the great people at TechStars to develop and organize a startup boot camp for Veterans. The program was a great success, however, a theme arose that startled me. Multiple Veterans told me: “I know Boulder is a great place for startups, but I hear it is not that welcoming to Veterans.”
After hearing this, Dave Cass (a Veteran and Boulder entrepreneur) and I surveyed a number of Veterans about this perception. Not all Veterans feel this way, but many do. Much of the perception comes from the political lean of Boulder. But some of it actually comes from individual experience who recounted negative experiences while wearing a uniform in Boulder.
I don’t expect Boulder to change, but the startup community should act to change this perception—Veterans should feel welcome.
Veterans are kick ass entrepreneurs. There are many examples of successful Veteran entrepreneurs, but very few in Boulder. I am a firm believer that Veterans have a skillset well suited for startups. They are problem solvers and master risk managers. They understand that failure is not an option. They understand leadership and commitment. For almost every startup, hiring a Veteran will add to the collective diversity of perspective and experience.
What I think we should do:
Spread The Word: Ask a veteran for their perspective and ideas on how we can do a better job of including this community. Talk about hiring Veterans with your co-founders and employees. Dave Cass and I are starting an online community as a means for Veterans and supporters to share their entrepreneurial stories, advice and wisdom. Stay tuned for details!
Take Action: If you are a founder, ask “How can we actively involve the Veteran community to find the right candidates for these jobs?” If you are an investor or mentor; seek out veteran founded companies.
Veterans, Come Check Out Boulder: Consider this your formal invitation! Start your company here.
If we can make Boulder a haven for military Veteran entrepreneurs, we will be a stronger community.
That said, Veterans will need to have an open mind about Boulder. Perhaps, It is best they hear from one of their own.
-Taylor McLemore / Founder of Prediculous (@T2theMac)
Sun Tzu wisely stated that “victorious warriors win first and then go to war”. It’s true; in the military we love intelligence. We never start a mission without first studying the players, threats, and opportunities. This reminds me of the importance of geographic choice when starting a company. There are a few communities in America that serve as model examples of a thriving startup ecosystem; Boulder is at the top of the list thanks to leaders like Brad Feld.
If a startup ecosystem is a community of players that work in balance to increase the likelihood of success, isn’t that the same symbiotic relationship displayed by military on the battlefield? And yet I see almost no military veteran first-time entrepreneurs here. Yes, our town is far left but our military community could just as easily be criticized for being politically one-dimensional and avoiding great startup communities due to political perceptions reduces our own potential and opportunity.
We left our comfort zone when we joined the military and my challenge to veterans is to do it again. If you start your company in Boulder, you will learn immensely from a new perspective and the startup community will be support you. We also have a great opportunity to serve as a positive ambassador for the military in a community that largely doesn’t understand us. Personally, I find it honor to represent the armed forces in Boulder and I enjoy the challenge that it brings.
So if the intelligence brief is telling us that Boulder could increase your odds of startup success, then more veterans should be starting companies here right? If we respond no, then we are ignoring intelligence–something we would never do in the military. If you’re a veteran and considering a startup community: Come to Boulder to attend a startup event and see for yourself what we have to offer. You may never want to leave.
-Dave Cass, Founder of Uvize (@uvize)
Today is Orbotix day at Feld Thoughts. I’m sitting in the House of Blues in Chicago getting ready to watch the Excelerate Labs Demo Day practice pitches waiting for everyone to show up and listening to the sound check guys blast music and say “hey hey 1 2” over and over again. I put my headphones on and listened to the new video by Sphero announcing and demonstrating their six new apps – Color Grab, Tag, Exile, Doodle Grub, a new version of Golf, and a new version of the core app which is massively upgraded.
Orbotix just released a new version of the Sphero firmware. This is a fundamental part of our thesis around “software wrapped in plastic” – we love investing in physical products that have a huge, and ever improving, software layer. The first version of the Sphero hardware just got a brain transplant and the guys at Orbotix do a brilliant job of showing what the difference is.
Even if you aren’t into Sphero, this is a video worthwhile watching to understand what we mean as investors when we talk about software wrapped in plastic (like our investments in Fitbit, Sifteo, and Modular Robotics.)
When I look at my little friend Sphero, I feel a connection to him that is special. It’s like my Fitbit – it feels like an extension of me. I have a physical connection with the Fitbit (it’s an organ that tracks and displays data I produce). I have an emotional connection with Sphero (it’s a friend I love to have around and play with.) The cross-over between human and machine is tangible with each of these products, and we are only at the very beginning of the arc with them.
I love this stuff. If you are working on a product that is software wrapped in plastic, tell me how to get my hands on it.
I’ve had my share of vomit moments – both in business and in life. It’s that moment where a specific thing happens that causes you to want to run into the bathroom and vomit, which you sometimes actually do.
Some of my memorable vomit moments including the night that I asked my first wife if she was having an affair and she nonchalantly said “yes.” Or when I woke up at 4am in the morning and realized Feld Technologies would be out of money in two days if I didn’t go collect some of our accounts receivable – primarily from customers who were clearly stalling to pay because of their financial issues. Or when I finally came to terms with the fact that the only real option for Interliant, a company I had founded and had gone public, was to file for Chapter 11 because we simply couldn’t service our debt. Or when I got sued for $150 million for fraud and read through the first filing which had my name on every page at least 10 times (after three years the suit was settled for for $625,000 and there was no finding of fraud – the other side spent $3m to get $625k – ultimately not a good plan for them.) Or when I got a call that a close friend, who was a CEO of a public company at the time, and his wife had been in a near fatal car accident and were both in surgery (they ended up surviving, recovering, and are doing great.) Or when I got a call that an acquisition of a company I was an investor in, which we had struggled through for months and was an outstanding outcome for everyone involved, had been called off because it wasn’t approved at the board level of the public acquirer. Or when I was on an airplane with my three Foundry Partners coming back from NY and we were diverted to Colorado Springs because of a massive storm in Denver and as we were landing I literally threw up – for the first time ever on a plane – because it was such an excruciating landing.
Some of the vomit moments, like the last one, are tangible. Others are conceptual. But they all share one thing in common – an intense moment of anxiety which is followed by the passage of time. Whatever caused the vomit moment either resolved quickly, or is something you have to go deal with for a while. While you may be paralyzed in the moment, I’ve found the most powerful thing is to realize that time will continue on and that you almost always can address the issue that caused the vomit moment and get to some sort of resolution. This resolution won’t necessarily be an external definition of victory, but it will allow you to move on to the next thing you need to address. The worst thing you can do is stay paralyzed, or go into a phase of explicit denial about what is going on.
At the Feld Men’s Chautauqua in Aspen this weekend, my cousin Kenny asked us all what our favorite quotes were. Mine was “It’s not that I don’t suffer, it’s that I know the unimportance of suffering.” (John Galt in Atlas Shrugged). Understanding that the vomit moment is part of life (and business) and accepting it, rather than fearing it, or denying it, results – at least in my opinion – in a much better life.
We will all have our vomit moments. But we will usually survive them. And taking action after they happen is the best approach.
What are some of your vomit moments?
I’m crazy proud of my partners Jason and Ryan – they are rock stars. Actual, real rock stars. Their band, Legitimate Front, is headlining at The Fox on Saturday night (8/25) at 8pm to (at this moment) an almost sell out crowd. Ross is joining them on stage and there might be some other special guests.
I’ve decided to help them sell out. I just bought 50 tickets and am giving them away to the first 50 people who comment on this blog.
If you want one ticket, comment once. If you want two (as in you have a date) comment twice. Please don’t comment three times – there’s a max of 2 free tickets a person.
The cutoff for commenting is 50 comments or 3pm on Saturday, whichever comes first. I’ll have all the tickets at Will Call with names on it – you’ll need to show your id to get them.
I’ll be there waving my arms in the air as Jason and Ryan do their thing. Come join me.
Dark Side of the Moon is my favorite album of all time. When I was a sophomore in college, I had an early NAD CD player. I put Dark Side of the Moon on at the beginning of the fall semester, pressed repeat, then play, and listened. I’d turn the volume down occasionally but not very often; usually I turned it way up. At the end of the semester, I pressed the stop button and turned my CD player off and then flew home to Dallas for winter break.
Today, a friend sent me a link to this amazing rendition of part of Dark Side of the Moon played by the Trinity Orchestra. If you are a Pink Floyd fan, it’s worth eight minutes and 24 seconds of your life.
I still listen to Dark Side of the Moon all the time. I’ve got it in my car (the only CD I have in my six CD changer) on repeat. I have it on my headphones that I swim with – my standard swim has turned into whatever I can do in 42 minutes and 59 seconds. And when I really need to grind something out, it’s what I listen to.
I regularly get emails and have discussions with entrepreneurs who are on the receiving end of a software patent lawsuit. Many of these are young companies, often with little or no revenue. It’s total, completely madness. If you don’t believe me, read the latest rant from a young entrepreneur on the receiving end of a software patent lawsuit from a troll.
My startup, all five employees and $0 revenue, is being sued by a patent troll. It is madness.
Software patents are weapons of mass extortion. The trolls know that the cost of patent litigation is huge- millions of dollars for a thorough defense. The vast majority of companies do a simple cost benefit analysis and settle. It costs a pittance to file a lawsuit, a fortune to fight. A troll can sue many companies and live off the settlements. Trolling is a lucrative, legally sanctioned business model with virtually no risk. The longer this continues the worse it will get.
And getting a patent is not that hard. For less than the cost of a small friends and family round you make a series of claims that describe your “invention”. Sort of a technical concept document written by a lawyer. There is no code required, no detailed product spec. You don’t have to build anything. We are being sued for having a UI connected to a server connected to a mobile device. And get this- data goes back and forth between the UI and the mobile device. Break through, right? Yes, according to the Patent Office.
And just like with illegal extortion, patent extortion causes real personal and economic pain:
- I wake up in the middle of the night with my hands clenched like lobster claws. I’ve actually cried from the injustice and worry;
- Every three hours of legal advice costs the same as an on-shore customer service representative with benefits for a week.
- A full legal defense could be my entire future Series A. And who is going to invest in that round when use of funds says “litigation”?
It is romantic to fight but the trolls know that a startup’s number one job is to stay alive. Screw romance. Screw justice. One lawyer I consulted told me not to read the patents- they were irrelevant. And the troll agrees. He said he didn’t really understand my business and didn’t care. We just looked like other companies he has sued. If your startup hasn’t been sued yet, don’t worry. You will.
What we need is leadership. But where are our leaders? In court. It’s disgusting. The millions spent haggling over the curvature of an icon could fund a massive lobbying and social action effort. Is it possible we can send a million tweets about happy cats but not stop patent extortion? We’re a community that believes in big dreams and blowing up obstacles. We can do this. We just have to try.
We constantly hear about “product market fit.” But my post yesterday about The Power of Passion When Starting Your Company was about “founder market fit.” And I’ve come to believe that – especially among first time entrepreneurs – founder market fit is much more important than product market fit at the inception of the company.
I stumbled on the phrase a few times over the past year and it’s been rolling around in my head a lot since. The first time was on Chris Dixon’s blog Founder / market fit which led me to a guest post by David Lee of SV Angel on More Thoughts on What Makes Great Entrepreneurs Great.
I’ve seen this over and over in TechStars. Founders come in with something they are super excited about. As they get exposed to mentors and feedback, they quickly start moving around within the market (or domain) as they search for a clearer focus, which could be defined as product market fit prior to getting a product out there and doing any real testing. This search is usually qualitative – it involves real feedback from potential customers and users, but it’s not a measured, tested approach.
In parallel, there’s often a Lean Startup methodology going on that does more quantitative tests of the specific product. But in a lot of cases, the qualitative feedback at the very formative stages is just as, if not more, important to make sure you end up in the right zone to test.
Underlying all of this is the regular shift away from something the founders are passionate about. The Orbotix example in my post is a great one – it would have been easy for Adam and Ian to decide to work on something that had a better product market fit, like iPhone enabled door locks, instead of something that not only hadn’t been invented yet, but also wasn’t obvious what market would really want it (a ball controlled by your smartphone – ok – that’s cool, but who will buy it?)
They, and their co-founder and CEO Paul Berberian had a vision for who would want a ball controlled by a smartphone. And Adam and Ian were obsessed with the idea. The three of them had extraordinary founder market fit, well before they figured out the product market fit.
We’ve got lots of other examples of this in our portfolio. I can’t tell you the number of times I get asked “what would someone ever use a personal 3D printer for?” But Bre Pettis at MakerBot is completely and totally obsessed with bringing 3D printers to the masses. While product market fit is getting clearer with each new product release, the founder market fit in this cases was awesome. Or Isaac Saldana of SendGrid, who initially named the company SMTPAPI. He has a great chapter in Do More Faster where he wrote about how he “Looked for the Pain” as a developer, found it in sending transaction email, and created SMTPAPI (now SendGrid) to address it. Or Eric Schweikardt who is unbelievably focused on creating the next generation robot construction kit at Modular Robotics. Sure – the “market comp” in this case is Lego Mindstorms, but Eric’s vision for the market goes well beyond this, and the product follows.
I’m not suggesting that product market fit isn’t an important concept. It is. But at the very beginning, especially with first time entrepreneurs, founder market fit is even more important.
It was the second week of TechStars and I was doing office hours with each of the 11 teams going through the Boulder 2010 program. I was sitting across the table from Adam Wilson and Ian Bernstein who each looked tired and dejected. In front of them were three slides.
I asked them what was wrong. They said they were having trouble deciding which of three different products to pursue. They’d had a dozen meetings with different mentors and were getting wildly conflicting data, which we refer to in TechStars as “mentor whiplash” and is a normal part of the first 30 days of TechStars for every team.
A few weeks earlier, Adam and Ian had their company Gearbox accepted into TechStars. They were hardware / software / robotics nerds and loved to tinker around. Their TechStars application and video had something to do with robots and their crazy desire to stay up all night hacking on them. When I’d last seen them a few weeks earlier, they were full of energy and life. Now they just looked defeated.
“Tell me about each of the ideas.” I asked. Adam started with the first one. “It’s a door lock controlled by your smartphone. The door lock market is really big.” said Adam in the most deadpan monotone voice I’ve ever heard.
“Ok – what’s the next one?” I asked. Ian mumbled something about the second slide on the table. I don’t even remember what he said.
“What about the third one?” Adam chimed in again, a little more animated this time. “It’s a robotic ball controlled by your smartphone.”
“Why are you having trouble deciding?” I asked. Adam kept going. “Some of the mentors like the door lock market but it seems like a really easy product to create and there are lots of door lock companies. And some don’t like it because it’s not defensible. No one really understands the second idea. And then there’s the ball – some mentors love it and others hate it.”
“Well,” I asked, “Is there one you love a lot more than the other two?” Adam and Ian looked at me quizzically, the same way my golden retrievers do when I ask them if they want to go for a walk. “Really, you just want to know which one we love the best?” asked Ian.
Adam jumped in, “Are you kidding. The ball. It’s a robotic ball you control with your smartphone.” Adam stood up with a gleam in his eye. “Brad, IT’S A ROBOTIC BALL YOU CONTROL WITH YOUR SMARTPHONE! HOW COOL IS THAT.”
At that moment, Sphero was born. And I knew that if Adam and Ian could make any progress over the next 10 weeks creating a robotic ball controlled by a smartphone, I wanted to invest in these two amazing guys. Their passion and obsession around the idea of a robotic ball you control with a smartphone was awesome.
Over the ensuing weeks they were regularly asked “what’s the market”, “who is the customer”, “how big is the market”, “isn’t it just a toy?”, and a bunch of other skeptical questions. As the weeks went by, they kept answering these sames questions with some variant of “we don’t really know but here are some ideas.” They kept working on the prototype and once they could drive something in a sort of a straight line, more eyes started lighting up and the “how big is the market questions” started to diminish.
Fundamentally, they didn’t know the answer, nor was it important at this stage. There are a zillion balls in the world and an endless set of applications for them; at this point Adam and Ian were pursuing the vision of a product that they were obsessed about. While some mentors and investors wanted to understand all the market and customer dynamics, others were able to see, or dream about, the enormous potential opportunities if the product could ever be created.