Boulder is showing the world about mentorship
November 15, 2009
During the last TechStars summer, we were visited by representatives from two foreign governments: Singapore and France. Both had heard about something interesting happening in Boulder. Each came and observed the program for a half day or so, looking for a productive exchange of ideas and opportunities.
During the summer, I was invited by the Singapore government to visit their country and I jumped at the opportunity. I love to travel to places that I’ve never been before. They also invited Andrew Hyde to come along, which made the trip even more fun.
Singapore is pretty much as far away as you can go in the world from here. It’s a beautiful place with very warm, tropical weather. The total population is about 4 million. As you’ve probably heard, it’s very clean and there is a very low crime rate. It’s an extremely international city, and you can find an amazing variety of food there. We ate at a Korean BBQ place that was out of this world. See my Everlater trip for my notes on my visit.
We met with various government organizations, incubators, and startups. What was shocking to me was the sheer volume of funding, programs, and services for startups. It’s quite easy to get government funding to launch your startup in Singapore. There are about 10 incubators there to support you once you get going. Unlike in the United States, immigration is easy – nearly anyone who wants to live in Singapore can just move there. It’s only necessary to fill out one form to start a business in Singapore. It’s an amazingly business friendly place.
One of the government officials described the situation to me this way. He said that from a funding perspective it was as if you had walked into a restaurant where you were the only customer, but where there were about 16 waiters and staff waiting to serve you. It’s that awkward feeling of over-supply of servers (funding) and undersupply of customers (startups).
I actually (respectfully 
) disagreed. I saw a very vibrant and young web2 entrepreneurial community. Sure, it wasn’t huge, but it had plenty of critical mass.
I think it was something else that was actually lacking. And it was part of why I had been invited.
Everyone was telling me that the few web startups that were there were mostly learning on their own. There wasn’t a strong visible culture of mentorship in the community. They were hungry for the benefit of some of my experience building and working with startups. Perhaps insatiable would be the better word.
All of the government funding support in the world can’t create deep, engaged mentorship out of thin air.
On my trip, I met one of the founders of Match.com, who happens to be from Singapore. I asked him why there wasn’t more mentorship, and he thought that it was a simple lack of supply of experienced mentors who had been there and done that. You got the feeling that a few of them were certainly trying.
E27, a great startup organization there, had invited me to do a talk on my final night in town. I tried to focus my talk on entrepreneurial ecosystems, comparing what was happening in Singapore (as far as I could tell) to what had happened in Boulder over the last 15 years or so. I encountered the usual “Silicon Valley envy” and challenged the entrepreneurs in the room to start a new culture of mentorship. I asked them not to wait until they were rich and successful, but to mentor someone else now. Today. They had all learned things that they could share with others in their community. Certainly, I also asked those that had startups that had been or would be successful in the future to go above and beyond in helping others follow in their paths by mentoring them, angel investing, and by creating visibility for their community. I think it was fairly well received, although the cultural differences there are evident.
One fact that consistently blew my mind was that everyone in the web startup community in Singapore, on the other side of the world, had heard about little old Boulder. They knew something was happening in the startup scene here. And they were looking to us for inspiration, knowing that they too will never be Silicon Valley, but still wanting to be the best Singapore that they could be just like Boulder is becoming the best Boulder it can be.
When I got home and reflected on this great trip, I was reminded that we need to keep doing more of this right here in Boulder too. I was inspired by the fact that we’re an inspiration to others around the globe. How amazing is that?
So…. Hey you – yes you – go be a mentor to somebody that you can help. Today. Keep helping others a core part of what our community is all about. The payback is truly mind-boggling.
Mentorship is on the rise in America. I’m proud that TechStars has been some small part of the inspiration for that when it comes to web startups. I’ve already been to a few other cities here as well, answering their questions about what’s going on in Boulder. Soon, I’m off to England and Denmark to work with local communities there on improving their own entrepreneurial ecosystems. So far, a pattern seems to be emerging.
Want your town to be the best it can be? Create a sustainable culture of mentorship, and participate in it.
Robert Reich and Add-on-Con
November 8, 2009
Robert Reich has done an amazing job building the new tech meetup here in Boulder and now in Denver. I was at the earliest of those meetups, when there were just 10-15 people there. Now there are 300+ and standing room only at every event, it seems. It’s now a fixture here in Boulder, and Robert deserves much of the credit for that.
Now Robert has put together at conference called Add-on-Con which is focused on browser add-ons. It’s happening in Mountain View, CA on December 11. They’ve just added a closing keynote called “The future of the web browser” which will be moderated by Douglas Crockford and featuring representatives from Microsoft, Mozilla and Google. They’ve also created a program called Sandbox which is designed to help new companies get exposure to the community and the browser vendors. Finally, they’ve created a game with the goal of facilitating name and face recognition of people attending the conference.
Robert was kind enough to offer me a discount code for anyone reading this who’d like to attend. Use “DCohenaddoncon09″, it takes $50 off of the $150 registration fee.
Internet Business Models of the TechStars
November 7, 2009
I’m a guest lecturer for an executive MBA class at Denver University later today. I was asked to talk about Internet business models (among other things), so I thought I’d take a look at the 39 companies that have been through TechStars to give them a sense of the relative popularity of various business models. I think this represents a fairly decent cross section of reality, since about 75% of these companies have raised outside funding after TechStars ended.
Some of these are open to interpretation or are really a hybrid of a couple of forms. My categories might be somewhat arbitrary. But here’s the data as I see it:
SaaS (33%) – These companies sell their product to customers via the web, and don’t bother with a “try before you buy” product. Examples include Rezora, SendGrid and Filtrbox.
Freemium (20%) – These companies give away a free product, and then try to upsell more sophisticated features or solutions on top of that. Check out Baydin and TimZon.
Sell Installed App (5%) – I broke this out from SaaS, because these companies are actually selling software that is licensed and physically installed. Subtle difference these days. A good example is RedLaser from Occipital.
If you add the three approaches above together, you get 58%. So well more than half of the companies we’ve funded are ultimately selling software to people who pay for it. Novel idea, huh?
Gather/sell eyeballs (18%) – You might call this the “advertising” model, or the “underpants” model. Some call it “audience aggregation”. Some of the companies which achieved early exits were in this category (Socialthing, Intense Debate) , but it’s quite risky too. Often, companies doing this initially have other models in mind once they reach a critical mass but can’t use that approach early on because they don’t have enough scale.
Marketplace (13%) – These companies try to aggregate buyers and sellers, and generally take commissions or service fees for providing the marketplace. Foodzie and oneforty are examples.
Lead Gen (5%) – These companies often provide a valuable free service, and then provide qualified leads to buyers. This is very similar to the Freemium model, except that the upsell is not more software, it’s other services or software provided by someone else.
Virtual Goods (2%) – This model typically involves providing a game or other interesting virtual environment and then selling virtual goods in that environment. J-Squared Media’s MiniPlanet is a strong example.
Crowdsourcing (SaaS) (2%) – These companies use the power of a large distributed workforce, often to do things that computers can’t do automatically or efficiently. Typically they ultimately deliver a service to the customer. Retel Technologies is a good example.
Content Production (2%) – Although it’s a perennially unpopular approach with investors, these companies create content and then attract an audience for that content, typically selling advertising inventory targeted at the audience or subscriptions. Howard Lindzon’s WallStrip is an example of this approach that worked well.
Enterprise 2.0 (0%) – I was surprised to see that we haven’t funded any companies (yet) that are taking web 2.0 consumer technologies and applying them to enterprise settings. Some companies I know of that are doing these sorts of things are Yammer and Brainpark, as examples.
So there you have it. If you’d categorize the models differently, please let me know in the comments.
