Startups #FAIL & VCs #SUCK.
But You Knew That Already • Play Blackjack, Not RouleJe. (Count Cards. Make Lots of Li^le Bets.) • Don’t Be An Arrogant, Insuﬀerable Prick. • Don’t Assume Your Diligence is 4 Shit. • Don’t Assume You. or They are Smart. • Build a Fucking Brand That MaJers. • Increase Sample Size. • Don’t Make Big Bets Too Early. • Simplify Revenue Model. (as in: HAVE ONE, you fucking idiot) • Bet on Hackers, Hustlers, Designers. • Create a Community. • Invest afer they have a funcRonal prototype. • Be early and contrarian, or late and right. • Use The Tools (you fucking idiot): Twi^er, Facebook, Quora, Instagram, Pinterest, etc • Talk / Blog / Present about something u know about, care about. • Admit Your Faults Frequently. • Laugh a li^le bit. (at yourself, not others). • Don’t worry too much about legal structure. • Worry a SHIT TON about valua)on. (because your exits will be SMALL)
Early-‐Stage Risk Reduc)on • Intro:
Crazy, Liars or crooks? Fucking idiots? • Product: does it work? (crappy, not perfect) • Market: are people using it? (not their mom) • Revenue: will people pay for it? (just a few) • Growth: how will it/they scale? • Finance: what will it cost – Q1: cost to get a customer? – Q2: how & when do you make money?
Your [up-‐front] Diligence Is An
Illusion (Real Diligence = Quick Check + 3-‐6 mo’s) • You Might Be Able to Detect Idiots & Assholes. • You Probably Can’t Figure Out Winners (Yet). • Your Network is Be^er Than Your Homework. • Trusted Referrals >> Diligence • FuncRonal Prototype >> Team. • Customers/Revenue >> Market. • You’ll Be Wrong 4x out of 5x. (If U Don’t Suck). • In 6 Months, You’ll Know If They Don’t Suck. • In 1-‐2 Years, You’ll Know If They’re Awesome.
Making Incubators Work
BeJer (This is Actually Pre^y HARD.) Find & Fund PotenRal. Help Them Improve. Educa)on & Community. Access to Mentors. Access to Investors. If You’re Lucky, Discover [a few] Winners.
It Takes A Village •
Physical Space. • People = Tribe. • Mentors (Advise 1st, Invest 2nd) • Events, Foods, Awesome. • This is YOUR FAMILY. Make Them AWESOME. • This is also YOUR BRAND. So Don’t SUCK. • Make a Big Tent. (Collaborate, don’t Compete).
Winners, Losers, Tweeners • Winners
#WIN (with or without you) • Losers #LOSE (with or without you) • Tweeners #TWEEN – They might win with your help – They might lose with your help – Be helpful, but don’t dally – Note: you might be wrong about the losers & tweeners, so don’t be a fucking arrogant asshole.
Scaling VC • VC is
an immature & fragmented market • It’s Ripe for DisrupRon • It Hasn’t Scaled (Yet)