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Even dirtierstartups
 

Even dirtierstartups

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  • http://en.wikipedia.org/wiki/Minimum_viable_product http://www.startuplessonslearned.com/2009/08/minimum-viable-product-guide.html
  • Venturehacks.com

Even dirtierstartups Even dirtierstartups Presentation Transcript

  • 9.04.2013
  • Who Am I? • Charleston SC Native • Have been a part of several startups • Worked as an architect at Apple (OSX) and Microsoft (a bunch of stuff) Skewlz: Umiami, Berkley, Stanford, UC Davis Livermore
  • Agenda • What? • Why? • How? • When? • Next?
  • “A great building must begin with the Unmeasurable must go through Measureable means when it is being designed and in the end must be Unmeasurable.” ~Louis Kahn
  • What is a StartUp?
  • What is a StartUp? 25 hours a day 8 days a week Everyday is Wednesday
  • What is a Startup? “A startup is an entrepreneurial driven organization that is continually searching for a repeatable and scalable business model” ~ Mark Babbitt
  • WOW – An Idea! • Guess what? – SO DOES EVERYONE ELSE.
  • WOW – An Idea! – A real time chat/msgr with 140 char limit (interest/intent graph) • Dydadic Relationships δ(G) = 1 3
  • WOW – An Idea! – A search engine based upon summing probability distributions over hyperlinks •PR(A) = (1-d) + d(PR(t1)/C(t1) + … + PR(Tn)/C(Tn) δ(G) = 1 3
  • WOW – An Idea! –Affinity Graph that allows you to connect friends based upon network theory: •(if A~ B) then (B~A) and (if A~B and B~C then A~C) δ(G) = 1 3
  • WOW – An Idea! “Ideas are cheap. That’s not where the value is in tech. Turning it into a company or into a product, that’s how you create value.” ~ Kevin O’ Conner, Double Click Co-Founder δ(G) = 1 3
  • WOW – An Idea! •   • “No one cares about your idea. Literally, no one, except maybe you cares about your idea.Your belief that someone is going to steal your idea is an illusion based upon the bias of your own perspective. Besides, ideas are completely worthless. Execution is what matters.” ~ Kyle Tibbits, Cofounder @HoverApp Marketing @ThisLife (Acquired by δ(G) = 1 3
  • WHY?! • Here are some reasons NOT to do it: – You want to help people - there are a number of worthy charitable organizations & causes out there
  • WHY?! • Here are some reasons NOT to do it: – You want to be as rich as the Facebook guy or some other rich person.
  • WHY?!    Here are some reasons NOT to do it: – You want a job where you get to hang out with your engineering friends -- form a hacker's club • “aka – brogrammers club”
  • WHY?!    Here are some reasons NOT to do it: – You want a small business to support a nice lifestyle for you and your family • you know your buddy's IT shop nets $2M a year.  »Whoo Whee!
  • WHY?!    Here are some reasons TO do it: – You've always wanted to build your own company from the ground up -- you were that kid selling lemonade
  • WHY?!    Here are some reasons TO do it: – You've been working on an idea you are passionate about that may make revenue and you've gotten some smart people interested in doing it with you
  • WHY?!    Should You? – Willing to devote 100% for 0-5 years? • Everything you do revolves around moving NewCo forward: –Take Care of you and others –Cut out all extraneous BS –Willing to live on reduced income etc
  • Should You ?! – Passionate? • Do you lay in bed thinking about it? • Stay up trying to code the idea? • You are synchronous with the product
  •    Should You?! – Love to hear NO? • That’s basically EVERYDAY. – HONEST WITH YOURSELF? • You will find out fast if you are BS’ing
  • WHY?! “You MUST be able to step on their throats and let SOMEONE ELSE clean up the roadkill” ~ Mark Cuban
  • Steps – Secure domain name – Familarize yo’sef with corp docs and process – Get a great lawyer that caters to startups – Form company (c-corp) – Have a notional aspect of domain space and tech space
  • Steps – Educate yourself on funding – Read Brad Felds book and Founders at Work blog – -The Four Steps to The Epiphany by by Steve Blank
  • Steps – Start working VC network – Do not form a board of directors – Iterate on everything code/ideas/money – Raise round while scaling – Close the round and keep raising – Go to 50 customer leads present hypothesis
  • Steps – OH yea … –Minimum –Viable –Product –M V P
  • MVP – MVP IS: – The BASIC features that allows a ‘product’ to be deployed
  • MVP – MVP IS NOT: – A minimal product • The point is to reduce iteration in selling and verification
  • MVP – MVP IS: – Do it the cheapest way • Its throw away • If you don’t have a crew in tow –Use a contract shop! –Offshore is getting REALLY good
  • MVP
  • Three T’s • A Ranked list: –Talent – Who ? –Tech – How ? –Timing – When ?
  • Talent • AKA THE CREW • A great team will turn a grade B idea into • a grade A idea • (Also companies buy startups for the team)
  • Talent • AKA THE CREW – At least TWO founders: • One Operational or Business • Other technical
  • Talent
  • Talent • Some words on Co-Founders – Get a great co-founder. This is too hard to do alone. – If you're not technical but have good domain knowledge in something you're passionate about: • get a technical co-founder. 
  • Talent • Some words on Co-Founders – Spend time up front learning if you can trust this person because you will have to trust them, with everything.  – Second only to your spouse or partner, this is one of the most important relationships you will have.
  • Talent • AKA THE CREW – Initial team needs to be a mix: • Nowadays KILLER front end and User Experience • Backend just as important • Some type of Stats or ML knowledge is good too • iOS/Android
  • Talent • AKA THE CREW • No one really cares where the crew presides as long as they are cohesive • We can thank GIT folks for this & • The Valley churn
  • Talent • “The only mistakes I regret are people mistakes.” ~ Brad Feld • “Steve hires the best people.” ~ Bill
  • Talent • Create Advisory Board – Knowledge of funding process – Domain expertise – Track record of building startups – Able to listen to crying for hours – They are like dating and BOD is like Marriage 
  • Talent • Create Advisory Board – They are NOT there to build stuff for you or raise money – Bounce ideas or just listen  – Make connections
  • Tech • We know it We LOVE it… – Sorry we cannot just code we have to THINK – Nowadays no one really cares about the tech – Framework coding has ushered in a new era – Patents are still important • REALLY Novel algorithms and methods
  • Tech • Languages: – Javascript, C++, JAVA, Python, R, Scala, Clojure • Backends: – Polygot persistance rulez • NoSQL and Graph Dbs • Android & iOS • Django, Flask, Code Igniter, SymFony
  • Tech – Which DB?
  • More Than Code • Import numpy as np • Import pynmf • from numpy.linalg import norm • from time import time • from sys import stdout • def DoMyStartup (V,Winit,Hinit,tol,timelimit,maxiter): • """ • (W,H) = DoMyStartup(V,Winit,Hinit,tol,timelimit,maxiter) • W,H: output solution (exit matrix) • Winit,Hinit: initial startup state • tol: value whereas you cant take it anymore (tolerance) • timelimit, maxiter: limit of time and iterations • #MajikHappens here… (eg rapid gradient descent to exit) • return (H, grad, iter)
  • Timing • Everything in life is timing – Time is money ~ Money is Time – Kill bad ideas fast and furious – Apply to all incubators – Apply to all angel venture lists – Start prototyping - yesterday
  • Process Stuff • Ya gotta do it to make it – C-Corp Filing – NDAs – Offer Letters – One Pager – CAP Table – Pitch Deck
  • C-Corp Filing – Ok for some I can hear the groans Why not an LLC? – I am continually asked by VCs of whom I make intros: • Are they Del Corp C –Just get the 250.00 and do it
  • CAP Table – This is who has what equity and at what price – Equity is the name of the game in a startup – Must be VERY simple • Allows you and others to put in various amounts of money raised and address dilution • Lists types of stock and outstanding shares
  • Funding
  • Funding
  • Convertible Note – Standard method for early stage – Angels understand it, good for friends/family – Converts to institutional round stock
  • Kickstarter – Great for pre-orders – Great for “good cause companies” – Can and cant be dilutive
  • Priced Equity Round – It is possible – It is the best mode for fast scale – Makes it VERY easy for Series A
  • Organic – Obviously the least dilutive – Self funded yields really good results • Series A – Usually takes a little longer to scale
  • On Funding – Get enough to complete customer validation – Or at least MVP – Know the market: read blogs books toilet paper rolls – everything – As a coFounder know the terms and terminologies – IT IS YOUR COMPANY
  • On Funding – Nothing gets a VC F R O T H I N G –Like.. –Traction or a Corp Deal !!!!
  • That’s a “B” folks…
  • Non Disclosure Agreement – Or NDA: • Have one and attempt to have everyone sign it • VCs wont so don’t • Board members/advisors/janitors • Although I have never seen anyone enforce one
  • Offer Letters – There are various types • Above all do not make it complicated! • Complicated equals legal crap • Legal crap equals time • Time equals money • You don’t have any of the above
  • One Pager – This document is your faceplate • Discusses company snapshot • Founders • Industry • Business • Accountants • Current Investors • Market and Product • Logo and Address
  • The Pitch Deck – Know it love it sleep with it – Important items (8-10 slides): • Team up front • Opportunity – Why your doing it • Market • What makes you novel • Competition • Amount of ask
  • Last words on Docs – Please do not get fancy or make them overly complicated. – You don’t have time. • Most who have done this before are not going to screw you • They are in it to make money with a team as well as change the world • If you run into someone who grinds on these items – Drop them.
  • Now what? – Test your idea • If its consumer then talk to “regular” people about it • If they don’t get it in two sentences or less refine the idea or explanation • If its B2B make sure a corp ASKS for it… –Or a close variation
  • Now what? – Test your idea • Prototype – liquid code - MVP • Backend or heavy laden systems take deeper research –Enterprise etc • Kill it early if its not working
  • Now what? Test your idea –Test early and often –Do not fall in love with tech –Fall in love with company –Do Customer validation through prototype
  • Now what? Test your idea –Make some mockups (iMocks is killer) –Also wireframes via a great Ux person –Get feedback fast and hard
  • I T E R A T E
  • Someone Loves Me! • OK so lets say you raised 50k: • Get incorporated • Set up a HQ in an Epicenter • Buy a domain if you haven’t • Get a lawyer • Get a team hopefully for equity – Or Offshore IT • Think simple. • Go Big.
  • Someone Loves Me! • When speaking with other angels VCs: Two sentences or less Be prepared to give pitch • (e) subject: email from ted tanner (no canned emails) • If you are getting traction be choosy • Your lead investor is important
  • More Than Code
  • GO BIG OR GO HOME • You are what you build • Think BIG – bigger seperates the average from cutting edge • Watch pennies - except for talent • Iterate Iterate Iterate • Love to hear NO
  • GO BIG OR GO HOME • FOCUS FOCUS FOCUS FOCUS • Listen to your customer • Market your company and products • Simplicity is key: everything you do must reduce friction • Sell something legal
  • GO BIG OR GO HOME • Fail Once Fail Many – WTF? – Yea guess what - Everyone fails – As a matter of fact if you haven’t failed and tried again you’re not trying hard enough – In The Valley its expected
  • thoughts • Do not Panic and you may live… • Busy is not productive . You are your company • Culture = if you have to talk about it… • Lifestyle is what others do… You create the impossible…
  • thoughts
  • Thank you for Y O U R time! @tctjr