Sunday, November 23, 2008

The Empire Strikes Back

From the back of the bar at StartupEmpire, over the glass half wall of the VIP section-turned-standing room only, I look out over a sea of roughly 150 students, startups, investors and interested folks. At the front of the room is Rick Segal, quipping that yes, we are in a bar, but no, there is no bottle service – Yet. David Crow is up there with him, a seemingly fitting example of their verbalized Goal: Let the conference be Conversational.
Peter from Price Waterhouse Coopers, who is sponsoring, is proud to be a part of the “Ecosystem” (oh boy)

The venue is packed with folding chairs, and the Conversation gets pretty difficult at coffee breaks and interaction abandonments abound as people tire of others trying to shuffle past. The day is less interaction and more lecture, but the first speakers are good, and I’ve included a summary of a couple below.

The first speaker is Don Dodge, who fittingly crafted a talk around starting a business in difficult times. I perk up! This is the stuff we need to feed our spirits, whose beatings are second worse only to our portfolios. Though a bit of a commercial for Microsoft, Don gets me with one statement: All Markets are driven by Fear, and Greed. Fear is Temporary, Greed is Permanent, and the markets will get better, they always do. Whew.
So knowing that things are going to get better, why start a company now?
Great people are the number one thing…great people are available now that the economy is in a shambles
Big companies are retrenching; buckling down and great people get bored and leave. Scoop them up.
VC’s have tons of money and want to invest – Oh wait, this is Canada. He’s talking about Boston. Doh.
You are already down, you don’t have anything to lose right now! (Gee, thanks)

So what is different now? Investors are doing things differently. Ask yourself a question: is your product a vitamin, or a pain killer? A pain killer is solving a problem that can’t be solved any other way. This is what you want. Vitamins aren’t interesting when the market has a huge migraine.

For the sake of human progress, down-turns are a good thing. Investors will still invest in GOOD ideas. In bad times, crappy ideas got funded. Marginal ideas and people got money before 2001, allowing these companies and people to flourish, and diluting the rainy day funds.

Nowadays, Me-Too startups won’t get the cash, and better yet, ad-supported models are being scrutinized.

This was a good talk; from here it becomes a bizspark commercial. I suppose that was to be expected.

Austin Hill took the stage, and didn’t sweeten up the bitter pill. A mocked cover of Time Magazine silently shouts “We are F*&^ed”. Wow, this roller coaster reminds me of yesterday’s TSX. Austin embarks on a vehicle-based metaphore that I can’t quite keep up to – something about rickshaws and submersible RV’s. (Don’t be either of these, be a Prius, if this makes any sense to you)

Keeping with the roadtrip theme, Austin gives us some tips on what to pack for your investor adventure. This is useful.
1. Your Pitch. 95% of entrepreneurs suck at this. Suck. No Really. Suck (Examples of this come later in the day)
a. Paint a compelling, passionate and believable pitch
i. Practice and get coaching
ii. Got to web 2.0 summit videos, get ideas
iii. Don’t step into the room before you are ready
b. Pirate Metrics - Analytics
i. Startonomics
c. Waterfall and Cash model
i. See the template on Austins blog
ii. With this much $, we accomplish this, with $$, we accomplish that.
iii. Be honest with yourself about what will happen going forward
d. Risk Reduction
2. Product Planner
a. Process flow and rates user flows… love this!!!!
i. Resource for web property
3. Pirate Metrics – 5 step startup metrics model
a. Acquisition
b. Referral
c. Retention
d. Revenue
4. Balsimiq
a. wireframe tool – love it

The last minute addition of “Insta-Pitch” attracts a large number of startups willing to share their ideas, and is entertaining when most are lambasted by the 4 investors on the stage. A Reminder: This was a last minute addition, and none of these startups would have prepared for this.

Here’s the Wrap:

One Data
You are organizing a blog
You have documents with company name all over it
You find out you need to change the company name…. but you are ready to ship your product.
What if you could have the data to update itself automatically?
Distribution Model:
Sell one, then use consulting companies to distribute it (Um, what is it?)
Back end technology for this service is set to become the platform for web services in the future
If One Data get’s investment, will hire sales and product management

You wasted time announcing what you are going to pitch, instead of just pitching…first four minutes should be consistent, tight, nailed. Get to the WHY, and HOW you solve a problem. Use it IS, we HAVE, then ask for the money. Don’t tell us what you don’t know. It is a crowded space; get a clearer focused strategy with a tighter differentiation of the product
What is the really hard pain point that you are solving?

Media Zoic
Use the wisdom of the cloud – the cloud knows what is good for you; lastfm and itunes genius know what is relevant for you. We believe the paradigm is evolving to be the wisdom of your own network. Social leveraging – you want to use the technology out there, but you don’t trust the cloud for it; you want to look to the people you know for the recommendations (music, business, lifestyle). Media zoic is IM platform that delivers the content from your network; delivers information in real time through your network. We bolt into all IM clients.
3 principles:
1. so easy dads can use it,
2. don’t need to learn new software,
3. Chunkable
We are 3-6 months from revenue on first chunk

4 minutes doesn’t mean saying a 7 minute pitch quickly. You have to know who you are pitching to; I needed you to highlight key things more, with less fluff; Big introduction but disconnected from product
Scott Pelton
I don’t believe you bolt into everything; prove that you work on the big things, and then grow
First part was abstract of a novel; Never use paradigm shift in a pitch; buzzword; Don’t pitch that you are all things for all people I’m Looking for confidence in YOU as much as the idea, I didn’t see it.

Yow Trip
(see my blog post here)

You don’t make me greedy over the pitch
It’s about scale; I see the need and market (student type of play) but I don’t see the size and scale
I would repitch… talk about potential market – those that would travel if they had people to travel with – define the market
I want more info on your management

What comes after email? FB, Twitter, etc. Jacksified aggregates all the info into one place. Jacksified sends all your messages from all your places to one place. Anyone who sends msg on msn, twitter, fb, can come to SMS for example

Good pitch, but don’t like the market; big players are making huge bets in this area, deeply embedded in big companies; Differentiation is weak; users just deal with this stuff anyway
I’m just not inspired
I am inspired; I want ppl to know where I am; I can’t see how this gets monetized

Software development companies either go over budget or over time; Target is companies where teams deliver large projects, but members are not in one place; Usual user spends 2.5 days doing research that someone has already done; We post and package expert solutions and post them for other users in the company

Like the pitch in the first 30 seconds, but it went nowhere
You need to deliver a tight solution; I want a tight solution to a big problem; you threw out some flippant things; get to the point

Deliver digital content 10-100 time faster than wifi; Download feature film to handheld in minutes in airports; Kiosks in airports – ads on kiosk and on media

Good clear pitch; immediately gave something you can understand (dl movie in 2 minutes). Take it back to how big opportunity is
I totally get it. I don’t believe in the monetization with advertising; but if you just charge me 5 bucks, I’ll do it

Facilitates quality business deals
You are an entrepreneur, seeking funding where do you go? Seeking advice, where do you go?
Investor looking for deal flow, where do you go? You need CFO where do you go?
Service provider, looking for customers, where do you go?
Answer is Entrebahn
Would you pay a subscription to solve these problems?

This is going to be painful
as I was growing up at school you used to get these guys that would tell me a joke that was layer upon layer upon layer, and at the end there is no punch line. Stringing you out for nothing. That’s what this was.
It reminds me of that terrible commercial: Headache on, headache on… every question you asked, I have better answers, I have linked in. Core part of pitch is to get to point of what you do. It is an authentic moment. You missed the point of what you do, and what value you create. You discredited yourself in your pitch. 30-40 seconds to get to the point. I need to retrain you to talk to customers, investors, and media. I’m not interested in retraining anyone.
The worst thing is making me guess what you are talking about. No I’m not interested.

I say kudos to those willing to put themselves out there on a moments notice, and boooo to the investors who treated them like they should have been ready for a Venture Forum. Constructive feedback is needed, even desired by these folks, but the panel needed a Paula Abdul to temper the Simon-ish wrath.

After 5 hours of speakers, my bum is numb, and my head has checked out. The last couple of speakers were lost to me, and I glazed through the rest of the day (I heard I didn’t miss much, but those folks could have fogged out too, who knows)

The after-party upstairs at This is London allows for some good networking and much needed refreshments. I heard a few connections were made, and that Conversation that Rick and David were looking for, finally took place. Glad to be a part of it.

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