This is a guest post by Jeff Keen, the CEO of Accelerate Okanagan. The post originally appeared on Accelerate Okanagan’s website.
To continue the conversation regarding Startup Communities – Lessons Learned, I would like to discuss the 2nd of Brad Feld’s four pillars, the requirement to have a long-term commitment to build a successful startup community. Feld states that from any given point in time, it takes a 20 year commitment to build a successful startup community. This is not a static plan that gets created once and rarely revisited, but a rolling 20 year commitment that continually evolves with the growth of the community. For example, if you are 12 years in, you’ve got another 20 years to go. In the case of Boulder Colorado, which is constantly recognized as one of the most successful startup communities in the world, they have been at it for 14 years. And if you ask anyone in Boulder, they are just getting started.
So, how can you get started creating long-term commitment for your startup community? This is a very good and challenging question. First, I would recommend referring back the first pillar that states the community must be led by entrepreneurs. I would also add that not only must it be led by entrepreneurs, but entrepreneurs that have a long-term vision and commitment to building, supporting and staying in the community. I believe that without this grassroots level of support, it is too easy for the vision and priorities to change based on the personal interests of the individuals involved; momentum will be slowed and energy will be lost.
Over the years, there have been many people that have expressed interest in being part of building a vibrant entrepreneurial ecosystem in our community. There were several roundtable discussions, focus groups, brain storming sessions etc. Unfortunately, nothing practical and/or tactical (i.e., actionable) resulted from all of the effort. Meetings were organized, well attended and ended with enthusiasm…. but…. nothing happened! One of the problems was the meetings were being led by people that had many other priorities and very little time (dare I say personal interest) to define and act on meeting outcomes. What a waste of time… for everyone!
So, about a year ago a group of us reconnected with some of the people that attended those meetings. We then connected with entrepreneurial leaders in the community and invited everyone to…. you got it…. another roundtable meeting with the promise that this time it would be different. Invitations went out to 24 community members ranging from entrepreneurs, members from all levels of government, heads of academia, to service providers and mentors.
The meeting began with a commitment from everyone around the table that we were attending the meeting because we felt it was important from a community member’s perspective and not as a member of the organizations we represented. People were not attending to get re-elected or further their individual careers, but because they felt it was a priority for the community we all lived in and plan to live in for a long time. This acknowledgement set the tone for the rest of the meeting and provided the lens necessary to have truly meaningful discussion. We also stated that it was okay for people to raise their hand and say that they did not have time to be involved and remove themselves from the process, but it was not okay to commit and then not be engaged in the process going forward. We lost a few people after the first meeting which was awesome. We respected their decision and moved forward with a core group of 16 volunteers committed to working together and getting “stuff” done.
This group had two subsequent, very productive, meetings that resulted in the creation of our startup community purpose statement, a 20 year BHAG (Big Hairy Audacious Goal) and practical, tactical goals and objectives the group could rally around and begin work on immediately; this was a very important outcome because it provided an opportunity for some quick wins that were visible in the community which deepened the engagement with group members.
Themes were developed and working groups were formed around three key initiatives, 1. “Place” – hubs, or access points where entrepreneurs can get access to the services and support they need to start companies, 2. “People” – talent attraction and retention strategy to not only attract more talent to the region but to create opportunities that will retain local university and college students upon graduation and 3. “Marketing” – creating a brand and awareness that our community welcomes and supports entrepreneurs and is a great place to start and grow a company.
These working groups continue to meet on a regular basis and progress is being made on all three initiatives. One of the keys to this early success is that the three working groups are being led by entrepreneurs (leaders) and supported by other group members (feeders)…. sound familiar?
It is very early days and it is not clear what the long-term effects of our efforts are going to be… only time will tell. But, we are enthusiastic about the direction we are headed in. Due in large part to the efforts of this group of volunteers, we are currently experiencing an unprecedented the level of momentum and engagement across the entire community.
We will report back on future developments (hopefully success stories!) as our community continues to grow and will continue to share lessons learned along the way.
Jeff has 25 years of experience in the technology industry, having held executive level management and leadership roles in technology organizations in both the public and private sector. Prior to joining Accelerate Okanagan, Jeff’s roles included technology entrepreneur, founder, and executive in both early-stage and high-growth technology companies. Jeff is an Honors graduate from the British Columbia Institute of Technology (BCIT) and is currently leading the amazing team at Accelerate Okanagan (www.accelerateokanagan.com).
I recently finished Startup Life and want to thank Brad and Amy for writing such a bold and emotional book. I’ve been married for roughly twenty years and was separated for close to a year as my wife and I difficultly learned many of the lessons in this book. If I could go back in time and hand this book to my younger self, it might have saved us much angst. I really appreciated the openness of all the contributors and will be recommending it within the Lemnos Labs founder community.
What struck me about the book was that its lessons might not be absorb-able in one phase of your life. If I went back in time and handed this book to my younger self, would I have been able to hear all the knowledge and lessons it prescribes? I’m pretty sure my friends and psychiatrist told me how to be a better partner while pursuing my dreams of entrepreneurship, I just wasn’t completely ready then to absorb those ideas when I was in my twenties.
It feels like there are three life phases you read this book in; each phase bringing more understanding of the book’s lessons:
Phase 1 – The young entrepreneur
Malcolm Gladwell repeatedly mentioned the “10,000 hour rule” in Outliers, rightfully highlighting the time it takes to master something new. Young entrepreneurs, and we’ve all been there, are simultaneously trying to master building businesses and relationships. It’s incredibly hard to do one, let alone both, but I think it is even harder to accept guidance and wisdom on these topics at the beginning of the learning curve. Looking back, I can see myself denying so many basic problems at the intersection of my business life and my relationship with my wife, unable to see what is now obvious in terms of balance and commitment. I just wasn’t ready to see solutions to problems I barely understood.
I think younger entrepreneurs with less relationship experience reading this book will absorb some of the material, but have fewer reference points to relate to the lessons contained in the book. Hopefully what they have received is a pointer, so to speak, to a great reference on entrepreneurship and relationships that they can return to on a regular basis.
Phase 2 – The entrepreneur in crisis
Sooner or later every relationship enters more troubled waters. The stresses of entrepreneurship only exacerbate the natural tensions of a relationship. So many of the things that were pointed out in Startup Life seem obvious now, but in the apex of my marital challenges, this book would have been a godsend. Or a smack in the head! It is so hard to find consul and wisdom when you reach this point. It’s a difficult topic to discuss with anyone, let alone finding a fellow entrepreneur with great relationship skills who wants to talk with you about these personal, sensitive topics. I think Startup Life has maximum value for an entrepreneur in this phase of their lives, because the lessons it contains finally become timely, relevant, and critical.
Phase 3 – The maturing entrepreneur
While entrepreneurs often think of time as their greatest enemy, in terms of experience, it is our friend. As we mature, we finally start to start to notice the warning signs of issues in our businesses and our relationships, why they are happening, and have proven techniques to address our issues. Experience makes us more comfortable and capable in our relationships. I’m finally at the point where I sorta understand what to do to be a good partner! In this phase Startup Life provides great relationships tips and reminders that help you stay on course and reminders of potential problem spots. I’m working hard, as an example, to embrace shorter Qx vacations for my wife and I. In my limited experience with Qx breaks, they really spur creativity and force me to check in with the real world instead of the ten million little issues with my company that I tend to become fixated on over time.
I think this is also the phase where you recommend Startup Life to every entrepreneur you know that is in Phase 1 and 2 in the hopes they avoid your mistakes
Startup Life is a book you put on the shelf and re-read semi-regularly as you make life’s journey. It can’t be absorbed in one session and its lessons ripen as time goes by. An entrepreneur learns that you have good days and bad days both in business and in your relationship. Pull this book from the shelf for wisdom as you navigate those highs and lows.
Startup CEO: A Field Guide to Scaling Up Your Business is a monumental book that comes from the heart of Matt Blumberg. You can tell by the author’s self-effacing and genuine style that he had the reader in mind, as he pours it all for you. It doesn’t get more authentic than that.
Matt never put himself at the center of the book; yet he draws on the depth of his 360 degrees of experience, having founded Return Path in 1999, and grown it to over 400 employees, across 12 global offices, and $100+ million in revenues.
This isn’t just a startup CEO’s book. It’s a book that will specifically resonate with any first-time CEO who is about to scale their company, and hasn’t done it before. That was Matt’s experience, which he sporadically chronicled on his blog, Only Once, but the book isn’t about his blog.
Founder-to-CEO transitions are tricky. Every founder assumes they will become a successful CEO one day, but that’s not the case in reality, especially if you’re a CEO for the first time. Compound the typical risks of startup failures with the risk of CEO transition failures, and the percentage of successful founders that end-up being CEOs, and leading a successful startup dwindles down.
That’s where this book comes in. It is the book Matt wished someone had given him on his first day as a CEO of Return Path, 14 years ago. But this isn’t a book you will skim over. I thought I could do that, but I couldn’t. This is a book with close to 400 pages, so you will need to read it diligently, and “return” to it often.
The book is organized into 5 parts: Story Telling, Building the Company’s Human Capital, Execution, Building and Leading a Board of Directors, and Managing Yourself so You can Manager Others.
This is not a prescription book that tells you there is only one way to do this or that. Matt goes beneath the perceived simplicity or glamor of a CEO’s job, as he dives-in with original thoughts on 47 topics such as creating the company’s operating system, collecting data, managing in tough times, driving alignment, learning the lessons, competition, failure, decision-making, working with a coach, the importance of peer groups, staying fresh, taking stock of the year, and even tips for traveling. They all share the common context of managing and growing a startup, from 25 to over 400 employees.
The book doesn’t cover management and leadership in the traditional sense, but it resembles a pretty good self-awareness confession with high dosages of wisdom sprinkled along the way, and it paints the reality of a Startup CEO’s life: it is filled with ambiguity and uncertainty, but it demands discipline and guts to get the job done.
I liked the importance given to “Story Telling” in Part I, because your vision and strategy are the rudder for your company. “Stories have a main character (the customer or user) and a supporting cast (investors, employees, partners, competitors). They have a beginning (the problem), middle (the product), and an end (the solution). Stories take a jumble of facts (profit-and-loss statements, customer surveys, market realities) and give them meaning.”
It sounds whimsical, but it is good to keep a simple picture of how everything ties together.
The dream is part of the idea, and Matt chatters the myth that the founder or CEO always has the best ideas, as he recounts two real cases of very successful products at Return Path that originated from other employees, not him.
The CEO needs to become a “functional supervisor”, says Matt. That’s probably one of the biggest shifts from founder to CEO. Your people are your most important resource, so you need to spend a big part of your time with them.
“First, Perfect the Model. Before you can think about the trade-off between growth and profitability, you have to get your business model right. Not just on your first Lean Canvas, but on your second, and your third. Get out of the startup phase and into the revenue phase. During this phase, you have to focus on neither growth nor profitability, but rather on frugality, on staying alive until you get to the point where you’re ready to start scaling your business.”
Regarding the challenges of managing remote offices and employees, versus keeping them in one place as long as possible, here is some wisdom from the book: “It’s just as important to be close to your customers as it is to be close to your colleagues.” So obvious, yet so important.
On innovation; “If you don’t give your team permission to fail, you’re not giving them permission to innovate.” Yes, you need to continue thinking like a hungry startup, even if you have 400 employees.
On going global and preserving the company’s culture; “Beware of diverging cultures. It’s not just important to have a strong company culture; it’s important to have just one.“
Then, there is some drama as Matt takes us back to 2001 when he was still a fresh CEO, and they had just merged with another company. Fred Wilson who is on his Board suggested that Matt works with a coach, Marc Maltz from Triad Consulting because Fred felt that Matt could be “doing a better job in a few areas”. Matt grudgingly agreed, thinking he didn’t have a lot to learn, “the arrogance of youth”he admits. That particular relationship proved to be of critical importance, because Matt later acknowledged that Marc became one of his most valuable assets and advisers, even giving him credit as “one of a few reasons Return Path is still in business!”
One piece of advice given by Marc stuck with Matt: “The biggest risk for a CEO is to lose sight of the boundary between yourself and the role you fill.”
Peppered throughout the book are short takeaways from external voices, each narrating their own perspective on the Startup CEO’s job. These passages are well pointed, and include advice from Fred Wilson and Brad Feld (both on his Board), his executive assistant of 8 years, his CTO, and a slew of other key staff and outside experts.
Startup CEO is a wonderful book that alternates between story telling, lessons and best practices. It does a great job at letting you fill-in your particular context for your own take-away.
For a startup CEO, founder or co-founder with management responsibilities, it is up to you to take initiative on educating yourself so you can grow-up either by learning, by doing, by getting coached, or by getting supported in a peer group. And Matt shows you how he did it that way. Matt had the good fortune of relying on a good caliber of mentors, coaches, and venture capitalists that supported him, but his message is that you too, can carve your own luck and be inspired by how he did it.
As a side effect of the book, you get an inside look into Return Path and its culture, and it comes out as a pretty likeable company.
As a startup CEO, you will see yourself in the book, and you will relate to the stories Matt tells. This is a must-read for any startup founder or CEO who is about to scale from 25 employees and upward. Even if you haven’t hit your product/market fit or growth curve tipping points yet, it’s not premature to find out what will happen when you do.
As a founder, and especially a first time CEO or senior executive, you could ignore this book at your own peril. It will be released Sept 3rd 2013, and it’s available on Hard Cover pre-order, or Kindle version.
About William Mougayar
Started 3 companies, pivoted 1 (Eqentia), sold 2 (CYBERManagement to Aberdeen Group, and Engagio to Influitive). Worked for 3 sizes of companies: 2 large (Hewlett-Packard, Cognizant), 1 medium (Aberdeen), and 4 small (startups). So, I’ve seen the whole spectrum. And in every case, each company was experiencing a high velocity of growth.
I also wrote 2 books, consulted for numerous companies, was a professional speaker and wrote a ton of articles throughout the years.
The Denver-Boulder corridor: At one end is a thriving community of startups, tech companies, and investors, and at the other end is…a thriving community of startups, tech companies, and investors. So why the divide? Each city is doing fine on its own, but together we can turn this region into one of the most dynamic and economically important innovation hubs in the world. Join us for drinks and networking to help us bridge the longest 25 miles in business and look for ways that Denver and Boulder’s finance communities can join forces to expand both their collective strength and their individual investment opportunities. We’ll have a few brief comments from Jim Dieters, Brad Feld and the Startup Phenomenon team.
A million thanks to the World Startup Report team, sponsors, and volunteers around the world for making this trip a reality. It’s been an amazing 6 months. Here’s a recap of what I’ve learned on the road.
Time flies when you’re off exploring startups in far flung lands. Six months ago I set off with just a carry-on and my trusty laptop, bright eyed and armed with boundless enthusiasm – I was ready with a capital R, to explore the world of startups. Now six months have passed and amazingly, I’ve realized that the more I learn, the more there is I need to learn. 6 months, 16 countries and 1000s of startup conversations later, I have only scratched the tip of the iceberg. The people I’ve met and the passion they have for what they do, often times in the face of great adversity is equal parts motivating and humbling. Its been a whirlwind journey so far and I am beyond excited to be able to share these findings. So on that note, here’s a little mini recap of my trip to date. Stay tuned for the full startup reports!
What in the world did I find?
India: hello, Google? Running a search engine via telephone may sound funny to the Valley, but really is it that different from asking Siri where the nearest parking lot is? Now picture Siri as a live person and put yourself in a country with 895M mobile phones vs just 35M smartphones. JustDial is a $720M empire in India…and it’s just one of many catering to this unique market.
Nepal: Don’t discount this hidden gem – even in a country where there are rations of only 12 – 16 hours of electricity per day, you can build tech firms with $100M USD exits.
Australia: Being a small yet modern and accessible country can be a double edged sword. On one hand, you get access to the latest and greatest from the West, but on the other hand, this very same lack of entrance barriers eliminates many startup opportunities for locals hoping to break onto the scene. Expect stiff competition here.
Greece/Spain: This could be a classic case of turning lemons into lemonade. 50% unemployment rate among youth might turn out to be the fire-starter that Greece/Spain startup ecosystems need.
Argentina: The story of Argentina can be told through their currency, which devalued 25% in the last 3 months. These folks are under constant pressure to produce in the midst of impossible constraints – trial by fire style. It could be argued that these conditions have produced the best entrepreneurs in Latin America.
Brasil: Size does matter. Virtually all successful Latin companies make the move to Brasil after their initial growing period, despite the unfavorable laws and social instability.
Peru: Though one of the least developed countries in South America, it’s also the place with the highest growth. Serious potential here.
Colombia: When a country invests 40% of the national budget on education, it changes things and empowers people.
Chile: StartupChile might go down in the history books as one of the best things to ever happen to Chile in this decade.
Kenya: The future of mobile payment can be seen in Kenya today. M-pesa is a micro-financing and money transfer service all easily accessible from your mobile device. It accounts for 25% of the country’s GDP.
Ethiopia: There are two 1s you have to know about Ethiopia: 1% internet penetration rate. 1M new cellphone subscribers a month.
Philippines: The Peru of Southeast Asia, but three times bigger with its 100M population plus everyone speaks perfect English. Keep an eye out for it.
Thailand: Unbelievable infrastructure and ample access to talents through its tourism. This 70M population country is poised to do well.
Myanmar: For a country that’s only a year old, its infrastructure is surprisingly developed. Those who want to jump in for low hanging fruit might already be too late.
Israel: Roughly 70% of the startup founders at our meetup believe they can build a billion dollar company. With this much ambition, drive and optimism in the room, some of them could be right.
So what’s next?
There are 13 more countries on the list, equally split between Europe (Netherlands, France, UK, Germany, Ukraine, Russia) and Asia (Korea, Japan, Taiwan, Vietnam, Malaysia, Indonesia, Singapore). Big things are happening for the WSR team, keep following us to access the full country by country World Startup Reports as they become available. If your country is on the list, please let us know if you would like to help! http://bit.ly/helpWSR
Oh and one more thing… *drum roll*
We’re proud to announce the WSR closing ceremonies happening in the Philippines at the end of my 29-country tour, called Geeks-On-A-Beach. Some of our most influential and knowledgeable founders/investors from all over the world will join us at Geeks-On-A-Beach to discuss the global startup trends and opportunities, from Silicon Valley to India. This will also be where I share my overall findings, impressions and conclusions from my epic journey.
Don’t miss this opportunity to meet the world’s startup founders and investors. Sign up today and get the early bird discount. This will be an incredible event in partnership to help the local startup community in the Philippines.
Founder, World Startup Report
Special thanks to: 500Startups, Startup Revolution, StartupWeekend, StartupDigest, Brad Feld, Dave McClure, Flightfox, Boingo, Bizpora for making this trip a reality!
Bowei Gai is a serial entrepreneur from Silicon Valley who sold the company he co-founded, CardMunch, to LinkedIn in 2011. On New Year’s Eve of 2013, he boarded his first flight for a 9-months long trip across 29 countries and 36 cities to research the world’s startup ecosystems.
Bowei’s first project, “The China Startup Report”, received over 100,000 views on SlideShare. His new project, the India Startup Report gained over 150,000 views shortly after release. From January to June 2013, Bowei has traveled to the following places: India, Australia, Colombia, Peru, Chile, Brazil, Philippines, Myanmar, Thailand, Nepal, Ethiopia, Kenya, Israel, Greece and Spain. Below is his story.
How Should We Measure Success In Our Startup Community?
I’ve learned a lot in my 3 short years of organizing Triangle Startup Weekend (TSW). For one, you can get a lot done in 54 hours if you just focus on doing things rather than talking about what you plan to do. All of the Triangle Startup Weekends we’ve organized have been successes, each building on the previous and becoming a more efficient and impactful event for the startup community.
This past weekend, we hosted TSW EDU, North Carolina’s first Startup Weekend focused on spurring innovation and reform in the education space. Based on feedback from attendees, coaches, judges, sponsors, other organizers, and community members that followed along on Twitter, the event was a success. But how do we define success? Better yet, how should we define success?
How do we define success?
The first question I get after TSW usually relates to how many companies were formed or how many of the companies survived and are still operational businesses. How many got funding? How many are still around?
That’s understandable – it’s very human to think of the companies themselves as a measure for how successful TSW is at impacting our startup community. Don’t get me wrong, they’re definitely part of the equation. And there’s nothing worth hiding – both of the winners of TSW since 2011 are still around, operational, and joined by other companies that launched during TSW.
How should we define success?
I can tell you that after years of organizing TSW, the companies themselves are far from the most important measure of the event’s success. Just as website visits aren’t the best measure of success for a startup, the companies that form at TSW don’t tell the entire story worth telling.
When we tell people about what role TSW plays in the startup community, we start with the fact that it is one of the few events that engages the entire entrepreneurial stack. Brad Feld explains the importance of this engagement in Startup Communities and if he were to touch on the metrics that matter to a startup community in Startup Metrics, he would probably focus on more than just the companies that form out of Startup Weekends.
It’s common for attendees to meet future co-founders and find jobs. In fact, last year, one of our participants drove from Arkansas because his fiancée was starting graduate school in the Triangle and he needed a job. He walked away from the weekend with strong leads and found a job shortly thereafter.
One of TSW’s past mentors and judges, Richard White, CEO of UserVoice, came to TSW two years ago and points to the energy and engineering talent he saw as the sole reason he decided to open an engineering office in downtown Raleigh.
It’s those types of things that we should be talking about when we talk about startup events.
Just as we have done (or should do) in our businesses, we should rethink how we measure success in our startup community and ask ourselves whether we’re using metrics that matter or merely vanity metrics.
Broadly, TSW EDU introduced entrepreneurship to educators, and education to entrepreneurs. It’s very likely the EdTech community in the Triangle will point back to TSW EDU as a tipping point. It’s too soon to measure all of the things that will come from TSW EDU, but I can tell you the companies that form from the weekend are just the tip of the iceberg. And they’re impressive enough in their own right.
Brad and Amy sat down with Sandy Grason of ICOSA to discuss their new book Startup Life: Surviving and Thriving in a Relationship with an Entrepreneur…
I run a software developers group in Reno, NV called Northern Nevada Software Developers Group. Within the contexts of Startup Communities, our group acts as a feeder, but unfortunately we haven’t been as welcoming to entrepreneurs as we should have been. Conversely, some of our guest entrepreneurs haven’t been as good at consuming our material as they could have been. What follows are some observations and pointers to help make industry groups better feeders and entrepreneurs better users of such resources.
We get a wide range of entrepreneurs that attend our meetings. Unfortunately the vast majority of these entrepreneurs only attend one meeting. During that meeting, they make a feverish pitch for their newly minted company which typically motivates one or two developers to get more information, but many pitches often result in no interest at all.
I didn’t quite know how to put this issue into words until I read Startup Communities. The mantra of “give before you get” really applies to our situation and having entrepreneurs blow in and out after one session certainly doesn’t have any “give” to it. In the group members’ and my view, most of entrepreneurs are only showing up to get a few warm bodies on a project. They aren’t there to learn something or foster any sense of community. Meanwhile, I’m spending time, effort and money to engender a sense of community for developers and I want entrepreneurs to be a part of our ecosystem.
This pattern of “get before giving” has led me to be less accommodating to the entrepreneurs at our meetings. In most situations I’ll allow them to do a short pitch, but I’m often not very encouraging of their ventures and am generally quite standoffish. Over time this behavior stifled entrepreneurial interest and the experience has taught me that I need to be much more inclusive and welcoming to the entrepreneurs that attend our meetings, no matter their intentions.
I started inviting entrepreneurs to speak to our group in the hopes that it would help inspire more entrepreneurship both within the group and the community, but our meetings haven’t been well attended. I think this bears out Startup Communities’ point that there are entrepreneurs, and then there’s everyone else. I’ve come to understand that our role as a feeder is to encourage entrepreneurship and the commingling of professionals with entrepreneurs seeking talent.
My perception of the startup ecosystem has of course been colored by my own experiences. Having been one of the first full-time employees of a local startup I know the trials and tribulations of working at a young company. Long story short, the company failed and the experience didn’t exactly motivate me to want to join another early stage startup. Since then I’ve often dissuaded others from joining startups in the hopes of saving them from having to experience the same end result. I’d like to believe that I’m protecting the group members, but I’ve learned that I need to let everyone make their own choices. The fact is, their individual startup experiences will ultimately differ greatly from my own. So, if a group member wants to hear my stories, I’ll open up and tell them, but I’ve ceased trying to actively persuade them.
Expecting startups to fail is a failure on my part and is a perception I need to change. It’s not easy to walk away from a failure you’re a part of and for a long time I was embarrassed about my own startup failure. Young startups fail all the time, many of them for reasons that are impossible to overcome, but in my case I felt I should have and could have done something about it. Becoming comfortable with the the natural life-cycle of the startup ecosystem is something I need to work on and attending various events like startup wakes, open coffee clubs and hackathons will hopefully put me on the right track.
Industry groups are an important part of the feeder ecosystem. As a group, we can add a lot of value to our startup community, but in order to do so it’s vital that we check our preconceived notions at the door or we’ll never be the best feeders.
It wasn’t a long time, but it was certainly a good time when Brad Feld dropped by the Communitech Hub Thursday.
Feld, the 47-year-old Foundry Group managing director, TechStars co-founder, author, marathoner and all-around good guy from Boulder, Colo., was on his first visit to Waterloo Region.
Over about six hours at the Communitech Hub, he toured the space, met entrepreneurs, spoke about how to build a great startup community and helped judge a sold-out Startup Smackdown before returning to Toronto for an early-morning flight out.
Feld left us with much to mull over and plenty to be proud about, which I’ll expand on here in due course. For now, I’ll leave you with what he told me at the end of a long day.
Q - So, what did you think of your day here?
A - I thought Communitech was awesome. I had a great day here.
I didn’t really know what to expect because I hadn’t been to Waterloo before, and I thought the community was extremely vibrant.
There’s a huge amount of people who are working on the right kinds of things, and the energy level is off the charts, which is really, really fun to see.
Q - Did anything in particular stand out from what you usually see in startup communities?
A - I think the concentration of all of the different activities, including the accelerator, the university incubators, co-working space, event space, a bunch of entrepreneurs, the community space, is very powerful.
You see it in some other places, and it’s starting to appear in a more structured way in Chicago at 1871, or in D.C. at 1776, those two buildings. But this is a really mature example of it; it feels really built-out and not just well-organized, but extremely well-run.
It was nice to see, because I think there are a lot of people who aspire to have this at the core of their startup community, but it’s very hard to do, and it’s clear that this has been a lot of hard work over a number of years.
Q - So if you got home and (your wife) Amy asked, ‘How was Waterloo?’, what would you say?)
A - I’d say I had a great time.
I would tell her that I spent the entire time inside one building, so I didn’t really see Waterloo, but I saw Communitech, and I thought it was really cool.
“Do More Faster: Lessons to accelerate your startup” is a book of advice and learnings that have derived from the technology accelerator program, TechStars. Do More Faster is written by TechStars founders David Cohen and Brad Feld and includes contributions from many of the mentors and past participants of the program.
TechStars in a mentorship accelerator program that started in Boulder, Colorado, but now has classes in Boston, New York and Seattle. Successful applicants take part in an intensive 3 month accelerator program where they get access to mentors in order to create successful companies. At the end of the program, the startups have the opportunity to pitch their company to Angel Investors and Venture Capitalists.
Do More Faster is based upon 7 themes of what it takes to start a successful company. Each theme contains lessons that mentors and previous TechStars participants have learned through their entrepreneurship endeavours.
The 7 themes of Do More Faster are:
- Idea and Vision
- Legal and Structure
- Work-Life Balance
Idea and Vision
Part of the application process of TechStars is submitting an idea that the team will work on. This can either be a currently operational company, or merely just a vision for what is hoped to be achieved. In either case, TechStars accepts applicants based on the merits of the team, and not the idea.
It is this freedom to change ideas that allows TechStars participants to pivot into a completely different opportunity should the current assumptions reveal themselves to be wrong. This freedom enables a more iterative approach to finding a really big business opportunity.
A second common theme around ideas in TechStars is that ideas are worthless and execution can’t be copied. New entrepreneurs are often scared to share their idea in fear that someone copies them. The mentors of TechStars encourage participants to share their ideas with everyone in order to gain feedback and test their assumptions. Execution is really the most important aspect of creating a successful company. Even if someone else is working on the same idea, the execution of that idea will usually be quite different.
TechStars encourages applicants to get their ideas and products out into the open as quickly as possible, talk to customers and focus on the one thing that they can really do well to solve an important problem. All of these things can seem inherently difficult to first time entrepreneurs. By exposing an idea to the world, you gain feedback on it’s value and you are able to progress the opportunity quicker.
The second theme of Do More Faster is People and how it is the people that are involved in a company that really make the difference. TechStars is a mentorship driven programme and so it values the input of people within the community, mentors and fellow company founders.
The majority of TechStars companies are founded by at least two co-founders. Whilst it is possible to found a company as a single founder, it will require you to take on more work and stress if you choose to go it alone. A co-founder can not only do half the work, but she should also be a sounding board for ideas, advice and a comrade when the going gets tough.
The early employees of a company are really important for creating a good company culture. The culture of a company will usually originate from the actions and attitudes of the founders and early employees, so it is extremely important to choose the right sort of people who you want to work with. Skills and experience can always be taught over time, but a bad attitude will be like a cancer in your company. Many of the TechStars mentors advise to hire for culture and to hire slow and fire fast. If someone is not working out as an co-founder or an early employee you need to do something about it as soon as possible.
As mentioned in the Ideas and Vision theme, TechStars value a team’s ability to execute their plan. An idea is worthless without execution, and so the TechStars mentors push the participants to continuously and relentlessly execute their vision.
As the title of this book suggests, one of the mantras of TechStars is “Do more faster”. This does not mean reckless execution, but rather, creating a feedback loop to test and prove assumptions as quickly as possible. If a team can prove that an idea will not work, they can more quickly move onto an idea that will work. As a TechStars participant, you are encouraged to make decisions quickly, even when you don’t have all the information. A quick decision is usually better than a delayed decision, especially when the company is young.
Startups have a lot of disadvantages against established incumbents. Startups have no money, no customers, no partners and no leverage. However, Startups have nothing to lose and so they can take risks or focus on one precise opportunity without having to maintain legacy customers. If a Startup can’t take risks and move quickly with little information, they lose the one advantage they have over their established competitors.
During the 3 months of a TechStars program, each team will be getting a lot of different advice from some very experienced and respected mentors. TechStars teaches it’s teams to treat everything as data, and they should use their own synthesis of the various bits of data in order to make a value judgement on the future of their companies. This could mean completely neglecting the advice of a mentor, and instead, doubling down on an insight from a customer or a gut feeling.
The product is obviously one of the most important aspects of a company because it is the product that becomes synonymous for Customers. Many Entrepreneurs will try to build a product from their vision or an assumption, when really, a product needs to be created for a market opportunity.
As mentioned above, TechStars teaches it’s participants to move quickly. TechStars companies are encouraged to get their product into the market as quickly as possible. Many founders will be scared to put out a product that is not finished, not polished or lacking in features. However, it is this scope creep that will handcuff the company from ever releasing the product. The quicker you get a feedback loop with your customer, the quicker you can achieve product-market fit. As the old saying goes, “If you are not ashamed of your first release of your product, you launched too late”.
Part of launching a product is dealing with either established or new competitors. Every good idea will have competitors in some form, even if they are not directly competing against you. It’s important to find your differentiation and to market yourself as a clear solution to a concrete problem. Going after the entire market is too big for any company, you must find a single customer cohort, and a single opportunity to attack first.
When you are excited about your product and you are starting to gain traction, it can be difficult to stay focused on the current goals of the company. Usually as a startup, you will have an assumption of a market opportunity that you should try to either prove right or wrong as quickly as possible. Along the way you will have business development deals, partnerships, and new possible market opportunities at every turn. It’s important to stay focused on completing the current goal of the company before starting to chase every opportunity. Working with large companies can be great for distribution, but the opportunity cost of neglecting your other goals can be worth even more.
Creating companies on the Internet has a huge advantage over traditional companies in that you have a wealth of data about every possible metric. You can accurately track your marketing and how every penny you spend converts into revenue. You can track how your product is being used, how it is growing, are your customers coming back, or are they getting stuck or confused on a certain aspect. None of this data is available to traditional companies. The wealth of data that is available can be overwhelming. It’s important to only track the things that are important to your product and your opportunity. Tracking the wrong metrics can be worse than doing no tracking at all.
Whilst fundraising is an important aspect in the lives of many of the startups that go through TechStars, each of the participants are encouraged to take a step back and question whether they actually need to raise money at all. Some of the most successful TechStars alumni are actually bootstrapped companies that took no investment at all once the program had concluded.
Raising money might seem like the natural next step, but it is actually not such an easy decision. When you take money from an investor, you are giving away part of your company and you lose at least some control. Investors are looking for a return on their investment and so they plan for a liquidity event at some point in your company’s future.
Bootstrapping a company can mean slower growth, but you retain full control over your company and you are not forced into a liquidity event.
Recently there have been many startups that raise money when they really don’t need to. Some companies are capital intensive, or it will naturally take a long time to get to cash-flow positive. These types of companies need to raise investment or they could never get off the ground. However, it’s highly unlikely that your Software as a Service startup needs to raise money to get started.
If you are looking to raise investment, taking part in a program like TechStars will make the process considerably easier. You will be introduced to the right type of investors through mentorship and you will be immersed in a community of people who you can ask questions and get the right type of advice. Fundraising is a full time job, and so anything you can do to smooth the process will be beneficial to your startup.
Legal and Structure
When you are starting a company, it’s important to remember the legal and structural implications of doing so. During the life of the company, you will be entering contracts, taking on debt, handing out credit and dealing with partners, customers and competitors. It is your responsibility to ensure that the legalities of your company are correct before taking further steps.
You should ensure that your company is recognised as the correct legal entity. Choosing the wrong structure could lead to personal liabilities should your company default or you become involved in a legal battle.
Your relationship with your co-founders should also be drafted in a legal document. Equity agreements, vesting schedule and Intellectual Property rights are important things to get right from the start.
Nobody starts a company with the expectation that something could go wrong, but it is your responsibility to take the correct precautions just in case. When you start a company with a co-founder, you expect to be both committed to the vision of the company. But outside events, or a change in personal circumstances can dramatically change things very quickly.
Despite a lack of money in the early stages of a company, you should invest in a startup lawyer who has a lot of experience of dealing with companies in your situation. General purpose lawyers won’t have the same expertise or guidance that a specific lawyer will have, and so it will mean you will have less problems further down the road when the legal agreements are actually needed.
Starting a company from scratch can seem like a tremendous amount of work in the beginning as the future success of the company is entirely in your hands. Striking the right work-life balance is important because it is likely going to take years to really build a successful companies and so no-one can sustain an all work-lifestyle for that period of time.
It probably goes without saying that you should only start a company in an area that you are passionate about. When you naturally combine your interests with building a company it means you can dedicate more time to not only working on your company, but also acquiring knowledge of your domain.
But even still, it’s important to be able to escape the pressure and work-load that you are putting yourself under so you can continue making the right decisions for the future of your company.
Do More Faster is a fantastic book for anyone who is interested in building a startup. The book is comprised on many very short essays on lessons to learn. This make it very easy to read and to take actionable advice in very small chunks.
TechStars has become a world-renowned model for mentorship-driven entrepreneurship. If you are interested in applying for TechStars, or simply want to take the lessons and advice and apply them to your startup, Do More Faster is definitely worth your investment.
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