2011.04.08 startup-sauna-stockholm

Åke Edlund - “multitasker”2011 Seed Accelerator Co-founder C!C KTH-SICS Founder Cloud Innovation Center Coach Cycore Sony Ericsson EU-Supply Parallel Systems Ericsson Business Innovation1993 Uppsala, Rice, Berkeley, TechnionStartups Academia Industry

Åke Edlund Startup Life & Seed AcceleratorsSEED ACCELERATOR

Part 1/2 Startup Life

Preparing this presentation Something I’d needed when in your age My view - minimizing copy-paste Discussion – please do interrupt Adding realism to your dreams, still keeping them alive Inspiration

Startups, the theory #1 Get an idea Find a garage Create a world leading …. Get funding Do an IPO World domination!

Startups, the theory #2 Get an idea Write a business plan Get funding …

Startups, the theory #3 Get/steal an idea Use open source spare parts Add your own proprietary part Write a business plan Get funding …

Startups, the theory #4 Get an idea Patent it Wait for someone big to buy you …

Startups, the theory #4bGet an idea that complements some big players portfolioRun your business long enough to attract a good user baseWait some moreSomeone might give you a call…

Startups, the theory #5New technologyBuild a long range of products around thisLaunch them one after another…. that’s the ofﬁcial story

What can we learn from successstories? Not much Inspirational Some “must haves”

Startups, the non-theory, failures More to learn here! But who to tell you?

Startup failure #1 – too early Great product, won many prizes Many years of hard work in garage Bring in fresh VC capital CEO and mgmt from world class firm Defunct pricing model, non-viral Have to teach the market Heavy staffing and expansion – burn! Cash flow….

Startup failure #2 – too slowEven greater productStill possible to make betterJumps into an incubatorFix-fix-fix…. (instead of Ship-fix-…)Turns more and more into an R&D projectIncubator hires incompetent CEOs…Times up! Share holders leave.

Startup failure #3 – lost controlGreat ideaRunning fast, quick successful rolloutHuge burnrate, but succeeds in getting huge investmentsGreat offering of buyout – but, lost control, can’t get a sellMarket diesStruggle on

Startup failure #4 – never startedDecide to combine with consultancyAfter some years, you realize you’re nothingmore (or less) than a consultancy ﬁrm

What to learn from these failures? Quite much But, the risks comes in many ﬂavours #1: Listen to your intuition

Before we start Why startup? Why me? Why now?

Why startup?“Whatever you are building, its about passion, and lessabout the money.Your goals should be about changing theworld, or making the world a better place. There aremany people who set out to change the world a betterplace and didnt make a lot of money. But there are evenmore who set out to make a lot of money, did not make alot of money and did not change the world.” Guy Kawasaki

Why startup? Freedom, kind of … Creativity AdVenture, you better like it...

Build your teamFriends, or not?Getting full commitment – fair shareGet advice, but don’t expect too much

Build a presence Web – blog, mail, twitter… F2F – conferences (outside), …

Cost control – consulting In parallel with building a business As part of product development Safer but slower Cash ﬂow Reality check Recruitment

Ofﬁce – do you need one?Home sweet home, Cafés, Hotel lobbies, …

Finding customers Use your network Build a presence on the web Lot of calls, and meetings

Meeting customers, closing deals Negotiation – learn how, practice Ask, and ask again Build a relationship Learn to say ‘no’

Endurance - company Cash ﬂow – again! Your time – is limited

Endurance - you Burn out - not a joke - hard to get back from - signs – that you won’t listen to

Endurance – work hard, but smartValue your time. Get your sleep. Get time off.

Incubators Do you really need them? For what? How good are they?

Before buying a .com address Did you do your homework? Test it, not only on friends Do your googeling, but don’t drown Don’t overdo it!

Before buying a .com addressAgain: don’t read too muchIt is a highly complex problem, too many unknowns.Get hands-on experience

“You miss 100% of the shots you never take.” Wayne Gretzky (*)(*)Thanks John Greathouse - http://infochachkie.com/nps/

Part 2/2Seed Accelerators

VCs – old school Are you a x15 startup? Do you really need them, now? What will it cost you? Are they ‘smart money’ or just money? And are there any? And if not ….. don’t think business angels are that much better.

New School Re-think Startups Re-think Incubators Re-think VCs

The startup world is changing "Startups can be run so cheaply now (with open-source software, cloud computing, and virtual teams spread across the Web) that many more can achieve proﬁtability without any VC cash.” Paul Graham,Ycombinator

The startup world is changing "Imagine what it would do to the VC business if the next hot company didn’t take VC at all. The less venture capital there is for new startups, the faster the decoupling will begin.” Paul Graham,Ycombinator

The Innovation Landscape is Changing Bootstrapping: Cloud Computing, Open Source, Network, MobilityStartup: 1. Lower riskBootstrapping 2. Quicker to start 1. More Startups 2. More controlMore ﬂexible 3. Startup gets further to Startups with lessInvestor: + - More to evaluate Lower risk Less control Lower investment to more Harder to get in early Faster response Missing more

Seed AcceleratorsHelping many during a short time to get to a good next step.Very early stage. Technical focus. Technical entrepreneurs with Network AND Often backed by Venture Capital - that get helpwith volume and early information and lower risk. SEED ACCELERATOR

March 2010: "Y Combinator Matures" - 1/4 of Startups Funded Before They Finish the ProgramOctober 2010: 1000 sökandeJan 29, 2011: "Yuri Milner, SV Angel Offer EVERY New Y Combinator Startup $150k"

Seed Accelerator challenges 7 3 6 4 51 21 Applications ﬂow2 Filtering3 Deal making - start4 Match making5 Value increase6 Deal making - end, Finding investments for next step7 “Good ones” - seldom go through these services 42

SICS Seed Accelerator - Creating startups from scratch - Helping existing startups and innovative companies on clouds!SEED ACCELERATOR

SEED ACCELERATOR

Stockholm, examples of ongoing startups right now

Wrap up Startup Life and Seed AcceleratorsNote: Cloud Computing and Startups slides added for later

Summary We could learn some from the success stories, but more from the failures. Many like to give advice, but most of the mistakes you have to make yourself.

Summary Dont count on getting external investments. Don’t think startup, think microstartup

Summary Leverage on all technology and networking possibly available. Cloud computing is a good idea for many microstartups.

Summary Seed Accelerator is a unique starting point for microstartups close by.

Summary – Most important (1/II) Make sure to follow your heart, listen to your intuition - it is trying to tell you something important.

Summary – Most important (II/II) And make sure to have a good life at the same time, it is possible to combine with startups.

If you have the time – I doubt it… Write this down: www.sics.se/seedaccelerator www.fortune1m.com edlund@sics.se

“Stay Hungry, Stay Foolish” Steve Jobs

SEED ACCELERATOR Thanks! edlund@sics.se www.sics.se/seedaccelerator www.fortune1m.com

Extra SlidesMore topics, about me

Part 3/3Cloud Computing and Startups

Where do you have your focus today?

To Create New Or Manage Server Room(s)? Business?

When to (maybe) use Clouds today?Time limited tasks

Pilots

“We are now working on the new demo ---- but it will take some time.(Our main computer has crashed ... )” 2011....

2002. Stockholm. Startup.A typical Saturday evening... - 3 months of buying - Weeks to get it right - 1 month of POC - Years of ownership

Enter the Startups!

Startups Cloud"Startups can be run so cheaply now (with open-source software, cloudcomputing, and virtual teams spreadacross the Web) that many more can achieve proﬁtability without any VC cash.” Paul Graham,Y Combinator

“Top 5 predic7ons on cloud compu7ng 2010” 1. Rise of standards 2. First major cloud compu7ng provider outages 3. Microso< will be relevant in the cloud 4. Rapid consolida7on of exis7ng providers 5. Rapid rise of cloud compu7ng startupshGp://www.infoworld.com/d/cloud-‐compu7ng/top-‐5-‐cloud-‐compu7ng-‐predic7ons-‐2010-‐188

We’re already thereEvery company in Benchmark’s portfolio uses Amazon’s cloud infrastructure in some way, and about one-third of them operate entirely on web-based services and infrastructure.Billing startup Zuora, for example, is doing well despite having“not a single IT guy, not a one,” Fenton said – and that’s more meaningful than an analyst’s report. http://venturebeat.com/2009/06/25/ who-uses-cloud-computing-startups- do-vcs-dont/

More to discuss….Recruitment – kind of Marketing Nishing – the key to success and partnershipsNovel professional networks – ycombinator Investment cycles, building a step stone to IPOPricing – an art form, don’t overcomplicate it Know yourselfCustomer demand – do they know best? PitchingExecute – improve your skills More on VCsLeadership – work on it, daily Business plansTime to market – do you want/can you do it? Visions – or mantras, what is most useful, whyBusiness angels – or devils? at all? More on Ycombinator – pro and cons Exits – thinking about it already? Technology vs Sales – Ship vs Fix

SEED ACCELERATOR !"#$% !&()$% Åke Edlund

http://kaljundi.com/2010/12/11/startup-bullshit-bingo

2011.04.08 startup-sauna-stockholm

by Aake Edlund on Apr 09, 2011

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