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Bulletproofing your startup

May 25, 2006

I was just reading this month’s Business 2.0 cover story, How To Build A Bullet Proof Start-Up.

From what I’ve seen, many entrepreneurs neglect to do Phase 1, Step 1: “Stress-Test Your Big Idea“. They think they have to keep their idea a secret and don’t want to discuss it with many others. They miss a great opportunity to see if the idea is viable and the business model is sustainable. Perhaps most importantly, those who skip this step may have a hard time refining their elevator pitch.

Many also tend to forget about Phase 1, Step 2: “Build your founding team“. I’ve often described the ideal software triumvirate as the technologist, the business guy/gal, and the sales and marketer. In this article, they more generally describe it as “the ace technologist, a big strategic thinker and a dealmaker.” I’ve seen startups fail just because they lack the know-how in one or more of these areas. Don’t forget that the idea is really nothing without the people who can execute it.

Skipping those first two steps is a pretty good way to lower your chances of success.

The nest most oft-skipped step which the article describes in Phase 2, Step 2 is “Create an advisory board.” Many entrepreneurs have one or two trusted sources to help guide their business. What many don’t consider is that they need to carefully select advisors who bring contacts, industry experience, and potentially capital. Contacts and connections are a huge, huge, huge part of your ultimate success.

Overall, it’s a good article that you may want to bookmark.

Written by David Cohen · Filed Under Blog, Startups |  

2 Days in the Valley

May 25, 2006

I’m here in Silicon Valley for a meeting tomorrow to talk about iContact with a potential partner. Sue Kunz of Solidware happened to be presenting today at a deal symposium for Financing Partners, so I went to check that out.

Of course Sue did a bang up job as usual and now has a ton of momentum with potential investors here as well as in Vegas, New York, and elsewhere. It’s nice to see a Colorado deal at such an early stage being syndicated efficiently to angel investors located elsewhere. Nice job Sue and CTEK.

As I expected, I learned a few lessons at the symposium that I can bring back to Colorado. Besides the obvious (better dealflow), they clearly have their process down cold. As you might expect, the entrepreneurs who make it to these things out here are top notch. The presentations were crisp and clear and each company was interesting enough that they were given a full thirty minutes to present and take questions.

Not unlike in Colorado, the number one question that the angel investors kept asking in one form or another was “So what exactly is your sustainable competitive advantage?”. Every entrepreneur had better be prepared for that question these days.

So I’m out here in the heart of Silicon Valley, and technology is failing me left and right. My T-Mobile signal is coming and going (geez, I’m right next to Stanford). My hotel wi-fi is retardedly slow and inconsistent. Man, you get used to a world without wires.

I guess you’ve gotta go to Starbucks these days to get a decent connection. I just wish I drank that stuff. Ah heck, I’ll just buy an Izze. I’m keepin it real for Colorado, even in the Valley.

Written by David Cohen · Filed Under Blog, Startups |  

Every day I like Paul Graham just a little bit more…

May 24, 2006

Danny Newman (who built the PocketFuzz service that I recently profiled) tipped me off to Paul Graham’s latest essay entitled “How to be Silicon Valley“. In that essay, Paul sites Portland and Boulder as the two places closest to reproducing the ingredients found in Silicon Valley (wealth and nerds).

Paul’s latest essay provides some insight into the reasons behind the startup phenomenon in Boulder that we’ve been discussing here.

It was also a local press profile of Danny that inspired me to write my post “Colorado needs Y Combinator“, and to tie it all together for you - Paul Graham is the man behind Y Combinator. Yes, it’s a small world indeed.

A few weeks ago, I emailed Y Combinator and asked if they would consider replicating their summer founders program here in Boulder. Paul didn’t respond, but Jessica from Y Combinator did. She told me that they wouldn’t consider reproducing their program because they draw candidates from all over the country. Y Combinator is a commercial enterprise, so that’s an understandable response.

Maybe Paul will see this post on a trackback and reconsider. Or maybe not. Oh well, guess we’ll have to just do it ourselves then. Who’s in?

Written by David Cohen · Filed Under Blog, Startups | 5 Comments 

PositiveWare - Positive thinking about PSA

May 18, 2006

The day started off with another meeting at Travelers Café near Pearl Street. It seems that the trend is Travelers in Boulder, Starbucks elsewhere. I was meeting with a very animated gentleman named Charles Von Thun who is the CEO of PositiveWare.

You may have heard of PositiveWare because it’s been around for a few years. It started life as an employee performance improvement platform delivered via the web. Charles told me that the company has refocused and essentially restarted as a web-based project and activity management tool for service delivery businesses.

At a glance, this seems like something I would have used in my public safety software business within the Custom Solutions group. We had a really hard time getting visibility, accountability and metrics from that group. Professional services accounted for about 10-15% of our revenues and it was very hard to tell how good we were at estimating, tracking, communicating, and delivering on these projects.

Charles told me that PositiveWare is off and running and now has about 30 customers including the likes of Verizon and Avaya. When I asked Charles about his PSA competition such as BaseCamp and OpenAir, he replied by telling me that the company is really sitting in the sweet spot right between them. According to Charles, this sweet spot is companies or departments of 5-500 employees and is underserved.

PositiveWare is currently seeking investment as well as a startup-minded sales and marketing executive.

Written by David Cohen · Filed Under Blog, Startups |  

Colorado needs Y Combinator (the unincubator)

May 10, 2006

If you’re interested in very early stage funding models and haven’t come across Y Combinator yet, check it out. Y Combinator organizes summer startup school and founder programs and provides seed capital to teams of entrepreneurs with compelling ideas. It’s already cranked out several notable companies.

I was talking on the phone with Danny Newman the other day about my PocketFuzz post - id345’s latest project. In looking into his background, I found that after high school and while at CU Boulder, he just started cranking out his ideas. Danny actually pitched an idea to Y Combinator recently, and was turned down.

It makes me wonder how many other Danny’s there are out there who just go and take a job with some large company right out of college, losing their entrepreneurial “spark” in the process. Not everyone has the courage and support necessary to immediately pursue their ideas. However these kids who are still in school or are just graduating are probably in the best position of their life to take such risks, as Y Combinator partner Paul Graham points out in his “Hiring is Obsolete” essay.

Perhaps they just need a little funding and a creative and supportive model like Y-Incubator here in Colorado to start coming out of the woodwork.

What do you think of Y Combinator? Would you like to see something like this in Colorado? Are there things like this that I’m not aware of?

Written by David Cohen · Filed Under Blog, Startups | 2 Comments 

PocketFuzz - making songs available as ringtones

May 10, 2006

I have to say that I think the idea behind Denver-based PocketFuzz is pretty cool. Take any MP3 and upload it, then select a portion of it. Then send it to your phone as a ringtone. Neat.

A band can also upload a song and make the PocketFuzz ringtone available for download by fans. Then they can stick a link on their MySpace profile for their fans to grab the ringtone, and get a portion of those revenues.

My quick googling found a competitive service called MyxerTones and I found a MySpace based artist profile using that service as well. I also found some software for doing this on your desktop called ZingTone as well as others.

I was curious about this so I chatted with Daniel Newman of id345 (the company behind the fuzz as well as other stuff). He told me that the service is getting a fair bit of pickup with more than 500 artists participating with thousands of songs so far.

In talking to Daniel, I discovered the other neat services under the id345 umbrella and this partially inspired my subsequent post “Colorado needs Y Combinator.”

Written by David Cohen · Filed Under Blog, Startups |  

Cartasite moving to SaaS model

May 3, 2006

Denver’s Cartasite is providing fleet management solutions that enable location, monitoring, status, and condition of mobile assets. You can get a sense of what it’s all about in this brief demo.

I spoke with Jason Weinberger (VP of Marketing) today. Jason confirmed that the company recently completed a multi-million dollar venture round and plans to complete the migration from the current MapPoint-based solution to a fully web-based solution in the coming few weeks. Jason didn’t reveal specifics of the new mapping technology that will support the system but did make reference to both Google maps and Microsoft Live. Jason went on to explain that their business model is a unique competitive advantage because their recurring revenue model allows customers to utilize the technology without traditionally large up-front costs.

According to Jason, the company is focusing on two specific vertical industries thus far: car and truck rentals and pickup/delivery applications. Without naming names, Jason also said that Cartasite has early customer validation from major players in the rental truck market as well as the food and beverage market.

Cartasite has been in operation for about two years now, and was founded by David Armitage (past founder of Geographix, Qubit Technology, and others). Cartasite currrently employs 10 people and is seeking skilled SharePoint developers. I don’t know any but maybe you do. ;-)

Written by David Cohen · Filed Under Blog, Startups |  

Great posts worth repeating

May 2, 2006

Every once in a long while, I read a tremendous post about startups.

Paul Graham’s recent essay “The hardest lessons for startups to learn” is one such post. It’s from a recent Startup School talk. I can personally vouch for so many of these counterintuitive lessons. Another great essay in his series is “How to fund a startup” - I often pass this one along to founders - it’s thorough and simple to understand.

I have followed Paul’s Y-Combinator project with great interest (and envy, man that sounds like fun) for a while now.

If you’re an entrepreneur and you’re not subscribed to Paul’s blog you’re missing out. You can also subscribe to an unofficial feed for his essays - another must read for entrepreneurs.

Written by David Cohen · Filed Under Blog, Startups | 2 Comments