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Challenges In The Startup Ecosystem - Stanford Innovation Group (March 2010)
 

Challenges In The Startup Ecosystem - Stanford Innovation Group (March 2010)

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    Challenges In The Startup Ecosystem - Stanford Innovation Group (March 2010) Challenges In The Startup Ecosystem - Stanford Innovation Group (March 2010) Presentation Transcript

    • Challenges in Startup Ecosystem
      For Stanford Innovation Group
      3/29/2010
    • Why am I talking?
      Co-Founder of [Startup Digest]
      20k+ subscribers in less than 3 months
      Insight into 32 local startup hubs worldwide
    • Unsolved Problems in Ecosystem
      VC
      Branding problem
      VC Math Problem
      Platform exits
      Startups
      Co-Founder matching problem
      Speed to monetization
      Mentor advisor problem
    • VC
    • VC: Branding Problem
      Source: http://www.entrepreneur.com/vc100/stage/early.html
    • VC: Branding Problem
    • VC: Math Problem
      VC’s paid thru (2%) mgmt fee + carry
      Incentive to be larger = $
      Risky so 3x gross returns. Ie $600m fund needs to generate $1.8b return
      Investor owns on avg 20% of company
      Assume most companies will fail (7/10)
      Need to assume $1b+ exits
      Source: http://www.avc.com/a_vc/2009/04/the-venture-capital-math-problem.html
    • VC: Math Problem
      Source: http://paul.kedrosky.com/archives/2006/03/22/no_more_billion.html
    • VC: Math Problem
      Point: Traditional VC is
      a hard game.
    • VC: Platform Exits (tangential)
      Creating industries vs. Platform Exits
      New focus on $50-$150m deals
      Platform buys working model then adds distribution
      New focus product risk, minimize customer risk, relationships with acquirers
    • Startups
    • Startups: Co-Founder Matching Problem
      Consistently most clicked items in Digest
      No real market solution out their right now
      Source: http://entrepreneurialactivism.com/2010/03/25/the-co-founder-matching-problem/
    • Speed to Monetization
      You have $25k investment per founder.
      At $2k a month that’s 12 months
      NOT including travel, dev, exp, etc
    • Speed to Monetization
      We need to think of creative business models
      Subscriptions
      Transactions
      Job Boards
      Events
      T-Shirts
      ETC
    • New Words to Live By
      "Make money don't stop.“
       
      - Krutal Desai, aka "Brutal with a K"
    • Mentor/Advisor Problem
      Mentors and Advisors are the most consistently asked question
      How do you find great mentors with experience in your space?
      Operational vs. Experiential advice
      No market mechanism for this
    • Contact / Q&A
      How to I come up with a business idea?
      How do I get more involved at Stanford?
      Where can I meet cool people?
      Best sources for funding?
      Contact: Chris@thestartupdigest.comTwitter: @cmccann7Signup at: www.thestartupdigest.com
      Have you heard of Startup Waffles?
      Why should I go to in person events?
      What are some of the most exciting platforms?
      How do I meet a business co-founder
      How do I get people to use my product?