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UC Davis — Workshop: Gates Foundation Grand Challenges, April 23, 2010

VStart — Thu, 15 Apr 2010 15:40:34 +0000

Bill and Melinda Gates Foundation
Grand Challenges Explorations Workshop
Friday, April 23, 2010 at 3:00 p.m.
UC Davis Conference Center
2nd Floor Conference Room

The Office of Research, Office of University Development, and the Foods for Health Institute are hosting a workshop on the Bill and Melinda Gates Foundation, Grand Challenges Explorations Round 5.

Grand Challenges Explorations awards of $100,000 support early-stage research projects designed to overcome persistent bottlenecks in creating new tools that can radically improve health in the developing world. Successful projects have the opportunity to receive a Phase II grant of $1 million.
Topics for Round 5 of the Grand Challenges Explorations include:

Create Low-Cost Cell Phone-Based Applications for Priority Global Health Conditions
Create New Technologies to Improve the Health of Mothers and Newborns
Create New Ways to Protect Against Infectious Disease
Create New Technologies for Contraception

Two-page applications for the awards are due online to the Bill and Melinda Gates Foundation by noon on May 19th.
The workshop will be held on Friday, April 23rd at 3:00 p.m. in University Development’s large conference room on the second floor of the UC Davis Conference Center (across from the Mondavi Center for the Performing Arts).

For more information, please contact Vivian Carmichael, Director of Foundation Relations, (530) 754-4138, vlcarmichael@ucdavis.edu.

Hurting Angel Investing — Unintended Consequences …. or Not!

VStart — Mon, 29 Mar 2010 17:55:46 +0000

Senator Dodd’s current financial reform bill is designed to address financial reform and regulation of the big banks, including the “too big to fail” issue. But it may have unintended consequences by reducing the number of angel investors while at the same time putting regulatory hurdles in place. These hurdles will increase the time it takes (yes, even more!) for entrepreneurs to raise money, and put more bureaucracy in the way further discouraging angel investors.

There is a post on VentureBeat today that has more details and discussion. That post also has some good summary information on the SEC rules that relate to all entrepreneurs Read More »»

Sacramento Web Startup Chrometa Figures Out Customer Support

VStart — Wed, 10 Feb 2010 02:27:05 +0000

Brett Owens of Chrometa was one of the first entrepreneurs mentored by VentureStart. We recommended “go get customers” rather than trying to raise money from organized investors. He did that and has been growing ever since with an ever-increasing customer base.

Chrometa maintains an excellent blog and today we saw an interesting post on customer support for software companies and its challenges. Take a look and I think you’ll find that Chrometa have met the challenge well with some good thinking. The very fact their blog talks about this is also great marketing. Go Chrometa!

Med Tech Entrepreneurs — Don’t Miss This Sacramento Region Event

VStart — Tue, 09 Feb 2010 17:25:59 +0000

Don’t miss the first annual Sacramento Med Tech Showcase on March 30, 2010 at Sacramento State University. The theme for the 2010 showcase is “Transforming Medicine Through Technology.” Hosted by SARTA’s MedStart Initiative , the event will raise awareness of the medical technology industry and resources in the Sacramento Region and generate excitement about technology developments by companies founded and funded in the region.

The Showcase will feature:

Exhibit Hall Showcasing Med Tech Companies in the Sacramento Region
The Next Wave Med Tech Innovators Challenge, co-hosted by VentureStart
“Telemedicine- New and Exciting Frontiers in Healthcare Delivery” panel discussion
“Emerging Trends In Med Tech Investing” panel discussion

Join with other leaders and innovators in the medical technology field. More than 350 attendees and over 50 exhibitors are expected!

SAVE THE DATE: March 30, 2010 from 1:00 pm – 7:30 pm. (exhibit hall from 5:00-7:30 pm)

LOCATION: Sacramento State University- University Union Grand Ballroom.

REGISTER NOW

ADMISSION: $80 general, $40 SARTA member

For information on sponsoring or exhibiting at the event, please contact Laura Good at lauragood@sarta.org or 916-261-1873.

Web Startups — Do You Have a Technical Co-Founder Who Can Code?

VStart — Sat, 30 Jan 2010 21:34:54 +0000

VentureStart gets many Sacramento region web startups applying for our mentoring. Very often we see great ideas and the need to raise money to hire people to code the idea/application. We normally encourage these startups to get a co-founder, or someone who will work for stock, on the team, and then get some traction before even considering raising money from Angel groups or VCs.

Adam Kalsey, the founder of SacStarts and a VentureStart mentor, recently gave advice on this to one VentureStart entrepreneur and then published it on his blog. We quote it here since it is so relevant to web startups.

“Got an idea for a technology product but don’t have the technical chops to build it yourself? You’ll need to find yourself a cofounder.

You’re building a technology company, but have no technology people on the founding team. This leaves you with three options. Hire, outsource, or find a technical co-founder.

It’s nearly impossible for a technology company to succeed by outsourcing their early product. Don’t even think of going that route. Freelancers or outside firms can’t possibly deliver what you want because they don’t actually care about the product or the outcome.

To hire someone full time, you’ll need to pay them a reasonable wage. For someone that’s capable of taking the business ideas you have and translating them to a real working product that won’t fall over as soon as people start using it, you’re looking at at least $80k/year in Sacramento. Don’t think you’ll go get funding and then hire someone. You’re going to need a product before you can get any funding. Gather together whatever funding you have now and hire a developer. It’s going to be important to hire the right person the first time, so if you don’t have anyone who has hired technical people for small teams before, I’d be happy to help you screen candidates.

Your third option is to gain a technical co-founder who’s willing to build this for a cut of the company. Expect to give them 25-30% of the company, but make sure you have a vesting arrangement so some crook doesn’t sign on, take 30% and quit the next day. I can help you screen these people and advise you on how you can structure things with them.

Here’s the thing… You can’t just go out and “find a co-founder” any more than you can go out and “find a wife.” Your co-founder relationship is just that, a relationship. You’ll have a significant relationship with this person, and they with you. Likewise, they’ll have a serious relationship with the business. You need someone to fall in love with you and your idea and to love it enough they’re willing to take tremendous risks in order to be involved. People grow into relationships, they aren’t recruited into them.

So how do you find your co-founder? Same way you found your wife. You meet lots of people. Put yourself out there. Make sure people know you’re available. Date.

Talk about your ideas with everyone you meet. Most people won’t want to hear about it. But some will have feedback. This feedback will shape your ideas and change your business. Along the way, you’ll meet someone with a technical mind that gets just as excited about your idea as you do. You’ll find that the two of you can’t seem to spend enough time talking about the idea and the business. You’ll know that this person is the one.”

A Startup’s Twelve Days Of Christmas

VStart — Wed, 16 Dec 2009 16:40:04 +0000

Phil Reed was the co-founder of both ComputerLand and BusinessLand, two highly successful startups, both of which went public. He’s raised capital from the top venture capital firms in the world and also been part of small companies that never fulfilled their promise and had to shut their doors (if you ask him, those were the source of the most valuable lessons he’s learned). In fact, Phil has founded or co-founded over a dozen companies during his career and he is incredibly passionate about sharing those lessons and helping budding entrepreneurs.

So here are Phil’s top twelve lessons for entrepreneurs. Call it “Phil’s twelve days of Christmas for start-ups”. (You can see the original post here.)

1. Never have a difficult discussion over email or the phone. Phil has always taken the time to sit down with people face-to-face to work through problems.

2. When someone is acting irrationally, try and find the underlying issue. Are they having problems outside of work? Is their family ok? Look past this issue and try and help. Phil’s taught me that good people usually act irrationally only when there’s an outside root cause.

3. Build a large network of people you respect and trust to advise you on your business. More eyes make better decisions.

4. Avoid the temptation to put friends or confidants on your board. You need people who aren’t afraid to challenge you, and are willing to tell it to you straight.

5. Be careful of leverage. Just because you have the upper hand at the moment, doesn’t mean you have to use it. Having leverage and not using it is an extremely powerful gift. It usually comes back to you.

6. The quality of the people you hire mean infinitely more than the product you’ve developed. Phil’s mantra has always been, “great people build great companies”.

7. Enjoy the journey. It’s not about the exit or the liquidity event. If you’re doing it just for the money, you’ll never make it through the hard times.

8. It’s okay to build meaningful relationships with the people you work with. Life’s too short to not share those bonds.

9. If things go south, you have nothing to be ashamed of. Starting a business is a noble pursuit. Dust yourself off, look everyone in the eye, pay off your debts and know you gave it your best shot. Then go start another one.

10. Resumes only tell part of the story. Hire high-character people who have consistently demonstrated exceptional achievements in their lives, both in business and other pursuits.

11. Sometimes you have to be willing to go against the crowd. Have the courage of your convictions.

12. Always do the right thing. Trite? Yes. What’s the “right thing”? That feeling in your tummy. Don’t ignore it. It’s the “thing” that lets you rest comfortably at night.

Sacramento Entrepreneurship Academy — A Passionate Network of Entrepreneurs Replicating New Generations of Entrepreneurs

VStart — Sun, 29 Nov 2009 05:05:07 +0000

Why would students give up their Saturday mornings during school year to attend yet another class (and at 8 am no less) and why would busy, successful entrepreneurs, Angel and VC Investors, and business people volunteer their time to meet with them? It’s a passion shared by the students wanting a real, practical education in entrepreneurship, and mentors equally passionate about giving back and breeding entrepreneurs of the future. This is the Sacramento Entrepreneurship Academy (SEA).

The students are talented, motivated, ambitious people. Take a look at the video they put together with board members for SEA, one of Sacramento’s best kept secrets.

10 lessons in bootstrapping a business

VStart — Mon, 02 Nov 2009 17:10:26 +0000

Many startups with high growth ambitions immediately think of raising money from angels or VCs. This can be challenging for first time entrepreneurs, and if family and friends money is not an alternative, then the choices left are often credit cards or bootstrapping. Here is a post on the top 10 lessons in bootstrapping from VentureBeat.

There are two ways to build a business: Raise a bunch of money or bootstrap. When I was in business school, there wasn’t much attention given to the bootstrapping notion. The “MBA way” of growing a business is to write a business plan, raise money and then execute the business plan. But I think that’s almost always the wrong approach.

We bootstrapped Infusionsoft for several years before ever raising capital. The lessons we learned were, and continue to be, invaluable. Here are the top ten lessons we learned from this method – and why I continue to evangelize bootstrapping to entrepreneurs:

10. You’ll learn you can keep expenses low. In the early days, we learned that many “necessities” are really luxuries. For a long time, we didn’t have a copy machine. We used our fax machine, went paperless and occasionally borrowed our next-door neighbor’s copier. After a couple years, we bought one of those multi-function machines from Costco for a few hundred bucks. Not until we were doing a couple million bucks in annual revenue did we get a “real” copy machine. You can argue whether the copier is a necessity or a luxury, but you can’t argue that we learned to keep expenses low and still effectively do our work.

9. You’ll manage cash better once you have it. The discipline you develop when bootstrapping will stay with you so that you don’t blow your cash once you’ve got it.

8. You’ll develop your Minimum Viable Product. When you don’t have a treasure trove of cash, you get the product to market as fast as you can. Good is good enough. You don’t fret perfection. And you don’t waste resources “guessing” what your customer wants. You get it in the customer’s hands as quickly as possible. Infusionsoft began as a custom software company so we developed our sales and marketing automation software with feedback from our customers. Our R&D came directly from their input and as a result our product, with every release met the customers’ needs more and more.

7. You’ll know you’ve got a real business… before wasting OPM (Other People’s Money). I’ve just never felt comfortable taking an investor’s money if I don’t know I can multiply it. If you don’t bootstrap, you’re taking a serious risk with someone else’s money.

6. You’ll employ missionaries instead of mercenaries. You don’t have the big bucks to pay the hired gun. You can only afford to hire passionate people who really believe in the cause – and that’s a great thing. In a startup, passionate employees almost always outperform experienced corporate types who command big bucks.

5. You’ll stay focused on your core business. Raising capital can take more time than selling and servicing your customers. If you try to raise money too soon, you’re probably going to take your eye off the ball and leave your customers hanging. You might actually bring in more cash by spending your time with prospects and customers. Plus, you’ll raise money faster and easier after bootstrapping. Investors get excited about investing in a business that’s generating a lot of revenue and hasn’t raised any money from investors.

4. You’ll retain the equity in your business. Once you raise capital, you’re giving up some ownership in your company. The longer you can avoid raising the capital, the bigger the piece of the pie you’ll own down the road. For this reason, if no other, you’ll want to hold off raising capital for as long as you can.

3. You’ll retain control of your business. Investors have wants, needs and demands. Once you take their money, you need to answer to them. In the best case, they take up some of your time. In the worst case, they force your hand or move you out. Don’t bring on investors until you can multiply their money and thereby keep them happy.

2. You’ll learn to sell. When you don’t have cash in the bank, you’d better know how to sell. It’s amazing how many entrepreneurs who raise capital are great in academic discussions but terrible on a sales call. The art of persuasion is not what business school is teaching, but it’s what drives the success of the business.

Often when you have raised VC, it’s easy to fall into the “strategy” trap. That’s where the team spends most of its time engaging in relentless discussions on strategy and big ‘game-changing’ things, which is fine, but who’s selling? When you haven’t raised venture capital, you get your butt on the phone and you persuade people to buy your stuff. When you bootstrap, you learn that selling—while it may not be glamorous—is what drives the business.

1. You’ll listen to your customers. Bootstrapped companies learn from the very beginning that their customers—not their investors—sign the paychecks. They listen, they adjust and they care – because they have to. There is no other way if the bootstrapped company wants to survive. This fundamental concept is at the heart of why bootstrapped companies are stronger companies in the long run. They cultivate from the very beginning, and they ingrain in their DNA, a strong desire to serve the customer.

So, what did I leave out? What have you learned from bootstrapping? And when do you think it’s time to move from the bootstrapping game to the OPM game?

Do you have what it takes to be a founder?

VStart — Mon, 02 Nov 2009 16:50:53 +0000

Every wonder if you have what it takes to be a founder or co-founder of a company, or even an early participant. Below we copy a post from Steve Blank’s blog.

When my students ask me about whether they should be a founder or cofounder of a startup I ask them to take a walk around the block and ask themselves:

Are you comfortable with:

Chaos – startups are disorganized
Uncertainty – startups never go per plan

Are you:

Resilient – at times you will fail – badly. How quickly will you recover?
Agile – you may find the real opportunities for your company was somewhere else. Can you recognize and capitalize on them?
Creative / Pattern Recognition – can you think “out of the box?” Or if not, can you recognize patterns others miss?
Passionate – is the company/product/customers the most important thing in your life? 24/7?
Tenacious – can you keep going when everyone else gives up? Can you keep giving 200% despite all the naysayers who don’t believe in your idea?
Articulate – can you create a reality distortion field and have others see and share your vision and passion?

And I remind them that they should be bringing some type of domain expertise (technical or business) to the table.

This is the minimum feature set for founders.

Other Roles in a Startup
Generic advice given to entrepreneurs assumes that everyone is going to be the founder/co-founder. Yet for every founder there are 10-20 other employees who take the near-equivalent risks in joining an early-stage company. If you’re not a founder (by choice, timing or temperament,) you may be an early employee or a later stage startup employee.

(And my advice to students who believe they want to do a startup but are unsure if they want to start one, is to join one that’s already raised their first round of funding. Founders know they want to start something. If you’re unsure, you’ve just decided.)

I believe that founder, early and later stage employees require different risk/personality profile.

The Early Employee
If you’re a founder/co-founder all the attributes I mentioned above are needed in spades. However, if you want to join a startup as an early employee (say in the first 25 employees,) you can modify the list above.

You still need to be comfortable with chaos and uncertainty, but by this time the major risk of where the first round of funding is coming from is gone. However, you will be dealing with almost daily change, (new customer feedback/insights from a Customer Development process and technical roadblocks,) as the company searches for a repeatable and scalable business model. This means you still need to have a resilient personality, and be agile.

Early stage employees are “self-starters” and show initiative rather than waiting for other people to tell them what to do or how to do it. (You may be wearing multiple hats in one-day.) You have to be passionate about your work, the company and its mission to be working 24/7. But more than likely you don’t need to be as articulate or creative as the founders (they’re doing the talking, while you’re doing the work.) And while you do need to be tenacious, you won’t need to be the last man standing if the ship goes down.

The Later Employee
If you want to join a startup as a later employee (say employee number 25-125, before the company is profitable) you can continue to modify the list above.

You still need to be comfortable with chaos and uncertainty. And you will be dealing with change, but it won’t be the constant daily change the early employees dealt with. By now the company may have found and settled on a repeatable business model. And at this stage of the company rather than everyone doing everything, actual departments may begin to form. However, job responsibilities and organizations will change regularly and you need to feel comfortable in embracing those changes and taking responsibility and ownership.

And you’ll still need to have a resilient and agile personality, as new customer and product opportunities will appear and change your work. But it won’t be happening daily. And while you still need to love what you do your passion doesn’t have to extend to tattooing the company’s logo on your arm.

The Adventure of a Lifetime
Take the time and think through who you are and what level of challenge you are looking for.

You’re not joining a big company. Startups are the adventure of a lifetime. But make sure it fits who you are.

Negotiating with Investors; It Can Be Done, on TV!

VStart — Sat, 31 Oct 2009 20:52:11 +0000

It is always a challenge for entrepreneurs to negotiate a deal with investors but we found some videos from the ABC TV show Shark Tank. While the show is show biz and not very realistic most of time, it does have its moments and these videos have some lessons for entrepreneurs with some chutzpah.

Here is Part 1:

And Part 2: