barbwired: the business of technology

What NOT to Say in a Startup Pitch

2012-02-02T23:20:00.003-05:00

Common points of failure and why.

1. 1. That you have no competitors.

You do. It may be DIY or a more cumbersome product, but they are still competitors. Also, changing someone’s way of behaving or doing a task isn’t easy.

2. 2. “Even if we get 10% of this Billion dollar market, we will be big.”

Top down doesn’t work. Do bottom up planning that shows the marketing you will do to garner the interest and grow. It’s all about execution.

3. 3. Everyone will want it.

Do you really believe that? And, if you haven’t spoken to the decision makers for a purchase in large enough quantities, we tune out. Talk to prospects early and often. Understand the decision making process in your industry.

4. 4. Defensive responses and argument.

These are immediate turnoffs. Even if you have a really great reason for your way, listen carefully to what’s being said because there is a reason for the objection, even if it’s just that you weren’t clear enough.

5. We are solving the problems in these 4 or 5 or 6 markets.

      You do not have the resources to go after several distinct segments.
      It will only diffuse your development focus (different priorities for different markets segments)
     and will cost too much in marketing and time. Time to market and establishing a beachhead
     are important. Other folks have the same idea as you, truly. Get customers and then iterate the
    product to meet their needs.

Other entrepreneurs will add that the team needs to be aligned and discuss plans, goals, ethics, ownership. Personally, one of my startups had its first customer and imploded for this reason.

Read Geoffrey Moore’s Crossing the Chasm. It’s short and priceless. Understand what the Lean Startup is trying to say about connecting with your market and changing when necessary.

List of World Wide Business Plan Contests - add yours

2012-01-09T17:01:00.003-05:00

As entrepreneurship becomes more fashionable, and incubators and micro financing abound, more and more business plan contests also emerge. Below are the Contests that are intended to be ongoing and are typically annual. If your entry is a ‘one off’, please do not list it.

This list is meant to be organic. Please add to it. Try to keep to columns, shorten urls, etc. Once we have a long list, we can organize by COUNTRY and STATE.

CODE FOR RULES: M= members only; S=must be student, researcher or professor in the university; O= open to public; F= application fee

Name of Organization Location Contact or URL Rules

MassChallenge Boston, MA, USA masschallenge.org/ M, F

MIT $100K Cambridge, MA, USA mit100k.org/calendar/ S

WPI Venture Forum BPC Worcester, MA, USA www.wpiventureforum.org O,F

Harvard Univ. BOC Cambridge, MA, USA www.hbs.edu/entrepreneurship/bplan/ S

Rhode Island BPC Providence, RI, USA www.ri-bizplan.com/ O

Clean Tech Open (CTO) California, USA www.cleantechopen.com O

Wharton/U.Penn BPC Philedelphia, PA, USA bpc.wharton.upenn.edu/ S

UC San Diego San Diego, CA, USA challenge.ucsd.edu S

TiE All Asia BPC Delhi, India www.edc-iitd.org/ events O, F

We do our best to be accurate. If it isn’t, don’t get upset, just correct it!

Five for five: Advice on hiring in the new year

2011-12-30T22:18:00.005-05:00

Five for five on hiring: A gift for startups (and others) for 2012

1. #1 Hire athletes. As a young company, your needs will change frequently. You need people who have a thirst for learning, a desire to succeed and the fundamental knowledge in their functional area.

2. #2 Find the networkers: People who know people will be able to help you get resources and customers. They will naturally spread the buzz. You need them.

3. #3 Hire renaissance personalities. Flexibility and well-rounded knowledge also go a long way in business. Folks with different life experience, a variety of extracurricular activities and those who are avid readers and continuous learners bring an added dimension. These people are also usually gregarious (even when shy) and active in their networks (see #2).

4. #4. Be diverse. The world is. Your target market is.Don’t hire clones. Avoid the ‘old boys’ network mentality. Different backgrounds and experiences make a delicious stew. See #3.

5. #5 Don’t use an automated process for sifting resumes. It is impossible to write a resume that covers dimensions 1-4 above. You want someone who will add tremendous value: value that goes beyond raw knowledge of a programming language, a type of industry or an accounting package. Spend time thinking about the whole person. Read cover letters. Do a search. Don't go for a quick fix.

So, you want to be a consultant? The reason for the rates.

2011-12-21T16:58:00.002-05:00

	How to set consulting rates and what to expect if you want to hire temporary workers.
		ANNUAL
A	Base salary	$150,000	senior level expert (10-20 yrs)
B	Med Insurance	20,000	cost if purchased on own
C	Dental	1500	cost if purchased on own
D	Life ins.	1500	cost if purchased on own
E	Sick days	5000	included (would not be paid if consultant)
F	Holidays	3500	paid 2 weeks
G	Diability Ins.	2000	cost if purchased on own
H	401K contrib.equiv	10000
I	Seminars, training, subscriptions	5000
J	6.5% Tax	$9,750
K	Cost of equip	2500	computer, internet, printer, cell phone, software
L	Incorp. Filing fees	600	can be higher
M	Accountant and lawyer	1000

	TOTAL	$212,350	$102	per hour

Many contracts are not full time


	NOT INCLUDED
	Tuition reimbursement $4000
	Water cooler time 10-15%
	Tradeshow/meetings
	Parties
	UEI coverage $13,000
	Stock options/grants/bonuses $10,000 or more
	Less time managing/overhead
	Bus. Development time
	Uncertainty factor

	VALUE = $20+ additional per hour
	http://consultantjournal.com/blog/setting-consulting-fee-rates http://www.forbes.com/2006/11/06/bostonconsulting-marsh-mckinsey-ent-fin-cx_mc_1106pricing.html

#5 I’m Sorry But I Can’t Hear You: Remote Workers and Global Business

2011-12-16T20:27:00.001-05:00

I was on a conference call last week with five other folks. Between cell phones fading, a variety of accents, speaker phones and multiple people trying to talk at once, the call was inefficient at best.

This led me to think about two fairly well entrenched trends that deserve cost/performance analysis:

· Working from home

· Using conference calls (VoIP, Webex™, Video Conferencing, Free Conference Calls, GoToMeeting™) for meetings

First are the common arguments of the benefits:

· Low overhead (in real estate and utilities, at least) per employee

· Less time and expense traveling

While traveling to the far east for weekly update meetings of a global team is certainly not feasible, it brings up the question of the real cost of in-sourced, global and outsourced workers. Looking at the costs, one needs to include:

1. The cost of the hardware/platforms/calls/cameras

2. The cost of miscommunication

3. The overhead of slower and less interactive/dynamic (and perhaps, creative) conversations and meeting

4. The cultural dynamics of a team working closely and knowing each other (that lead to positive organizational behavior and culture and creativity)

What percent of the work actually takes longer or has quality issues due to poor communication? What part needs to be redone? How much longer is the meeting due to synchronicity issues?

Excellent communication requires most of our senses. This is well documented. In dynamics in which all senses are not available, we run the risk of:

· Minimizing the inputs of quiet/shy employees [think cultural norms and Hofstede]

· Possibly having team members disengaged due to their inability to follow the conversation

· Confusion over power hierarchy when voice owners are not clear

· Loss of information for team leader: sight- facial expression, disagreement, body language, eye contact. As Phyllis Thesier says: " ...can understand non-native speakers when we are face to face and can integrate the body language with what they say and how they are saying it."

· Loss of information with non-native speaker [can understand non-native speakers better when you can watch their mouth, for example]

As companies the use of these work styles, are mediocrity and less-than-ideal-quality becoming acceptable? Perhaps this will be considered a fad as business people look at all the costs.

#3 I’m Sorry, Game Players: Golden Rule Wins

2011-11-29T16:22:00.000-05:00

#3 I’m Sorry, Game Players: Golden Rule Wins

If your company encourages gamesmanship (and I don’t mean Foosball) then you may want to consider the consequences.

Companies who reward people for taking credit for something they didn’t do (or didn’t do alone) or taking credit for an idea are encouraging non-team playing. Some behaviors could even be a subtle form of bullying with the ‘in kids’ getting favored treatment and attention. And companies that reward – even in subtle ways – a group that socializes together over those that don’t are not valuing diversity.

Does a subgroup of high-level managers or executives go golfing? Or white water rafting?

Or do the managers go for beers several nights a week?

Are folks hired that look alike – i.e. all from the same university or boarding school or former employer?

Think of who you are excluding. Also, think of how this carries over to every day work. Are the golfers rewarded with non-public information or special assignments?

Among those excluded are often women, people who aren’t athletic, those with family obligations or, outliers. And yet, diversity in hiring (age, gender, national background, culture, etc.) has been proven time and again (Forbes or Harvard) to be enablers of more success in business.

Speaking of playing unfairly and not valuing diversity: why do we accept the unequal pay for equal, if not better, performance? And yet, women in the US are still earning 80 cents for every dollar a man does (for the same work). Won’t many of us, men and women, have daughters or wives? Why would you want them to earn less for equal work product?

Challenge: if your company is large enough to employ more that 5 people in any given role, see if the pay for level of experience is +/- 5%. If it isn’t, find the outliers and fix it. It’s only fair and healthy. And, it’ll likely be that the outliers are women or minorities.

Companies with a longer term view for success understand that different experiences provide the best and broadest information and view.

Massachusetts: It IS all here. State of the state economy paper.

2011-11-21T14:04:00.001-05:00

From MTC, Gregory P. Bialecki,, Massachusetts Innovation Economy

BREW, MIT Enterprise Forum, TiE-Boston, WPI Venture Forum, Mass Innovation Nights, 128 ICG, MDG, SBANE, MSBDC, MassChallenge, Meetups and many other organizations around the region help our economy grow.

Now, let’s move faster and in a more coordinated way!

http://web27.streamhoster.com/mtc/2010%20ma%20innovation%20index.pdf

#2 I’m Sorry, But The Business Tax Break Won’t Help the Economy

2011-10-22T16:27:00.000-04:00

I run a small business. At one time, I had more employees. The reason I don’t now has more to do with acquiring enough of the right mix of business to fit the skills of the employees than with the economy per se.

I know that if I got a few percent tax break, it wouldn’t be enough for me to hire anyone. For example, if I bring in less than $2MM of revenue like most small businesses according to the US Census, a tax break of 3% on profits is well under $60K. With taxes, benefits, training, and resources, it might buy me a $35-40K/ year person – one. More likely, the tax break would net me less.

Most small business, like mine, make well under this level of revenue with over 80% making under $100K.

If you are a larger businesses with revenues over $100MM, there’s a high probability that you are inefficient and/or overburdening your current resources. You may increase efficiency and get more products to market by investing in process streamlining and people.

If you are a very large enterprise with revenues upwards of $500MM, you probably have record levels of cash on hand. Holding out for a tax break in order to hire is un-American.So is hoarding. But that’s just my opinion.

#1 I’m Sorry, But Why You Can’t Find Good Software Engineers

2011-10-18T11:53:00.000-04:00

If you are a company that has had dozens of open technical positions that you can’t fill, look no further for I, a mere marketing weenie have the solution.

Software engineers or developers or architects are a special breed. They typically are highly educated with degrees in the elusive areas of science and engineering. And we know that, especially in the U.S., we don’t have enough of these STEM folks.

Even if you risked getting someone straight out of school, that’s not the same thing. Working on a development team (note what the word ‘team’ implies),managing a project and being able to turn product inputs and requirements from marketing into something sane are clearly skills that need practice.

It has to be difficult to keep products from getting to market quickly enough to gain a significant competitive advantage if you don’t have these assets. I was wondering how much longer the typical product development cycle is extended of this gap; it must be at least 3-4 months if each project is understaffed by several people.

So, explain to me why some of these folks with science and technical backgrounds -- such an amazing foundation, one that takes years to achieve -- aren’t being hired?

The folks in one of my job-seeking network groups -- about 250 that I’ve met in just one local group – who had the brain power to get through a tough STEM education, the acumen to learn how to be on teams and the experience successfully developing other products 10 years ago aren’t up to date on Java, Drupal, C++ or MEMS circuit design. I get it.

I’d think that it’d only take a few months to train them, probably while they were contributing in other ways. Wouldn’t it be worth getting your product finished, to market, and earning revenue faster?

Explain. I’d really like to understand.

(Back with a few new series of blogs).

What will VC firms look like in 3 years?

2009-07-29T09:54:00.001-04:00

I was at a Massachusetts Entrepreneurs' meeting this week and there was some disagreement over what an early stage VC is.

More important, I think, is the overall question of how startups will get funding. Startups are risky. Even those with teams that have 'done it before' struggle. No amount of due diligence can predict arguments within the founding team or product development issues. VCs consider a 1 in 10 homerun to be good portfolio selection.

In Boston, we have MTDC. We used to have Zero Stage Capital and Navigator. The role of angel investors has also changed since some of them are worth less than they were last year. Regardless, when a company needs, say, $2M, where do they go? There certainly aren't enough options.

If our economy is 95%+ startups of various types (with recognition that many are lifestyle or not sustainable), does the governement have a role?

Just about Everyone will be there

2009-05-05T08:33:00.000-04:00

All under one roof with plenty of time to network at http://www.tieconeast.org/2009/

Paul Alfonso
Brown Rudnick
Jeff Andrews
Atlas Venture
Greg Arnette
Sonian Networks
Christopher Austin
Ropes & Gray
Paul Bleicher
Health Insight
Mark Canha
Prism VentureWorks
Bhaskar Chakravorti
Harvard Business School
David Danielson
General Catalyst
Nick d’Arbeloff
N.E. Clean Energy Council
John Dix
Network World
Nathan Dowden
Frankel Group
Paul Heinzelmann
Partners Health Care
Satish Jindal
Schering-Plough-Hialeah
Ashok Khosla
Development Alternatives
Ken Lazarus
Lilliputian Systems
Tom Lee
Partners Health Care
Paul Maeder
Highland Capital
Dwayne Martin
Slow Money
Cyrus Mehta
Cytel
Bill Mitchell
Nuvera Fuel Cells
Dinesh Patel
MGH
PJ Piper
QM Power
Chris Poirier
CoalTek
Steve Rhoades
SatCon Technology
Bryan Roberts
Stemgent
Wade Rousch
Xconomy
Aaron Sandoski
Norwich Ventures
Richard Soley
Object Management
Vivek Soni
Boston Cleantech
Nick Sullivan
Author
Dorothy Suput
The Carrot Project
Joseph Ternullo
Partners Health Care
Rich Toselli
Johnson & Johnson
Brad Vale
Johnson & Johnson
Frank Van Mierlo
Colin Angle
Amar Bhide
Rory Cowan
Christina Lampe-Onnerud

You've Heard of Field of Dreams Marketing?

2009-05-04T19:41:00.000-04:00

A group of us are starting to turn the startup model upsidedown - an upstart! Several execs that are currently unassigned (read: not fully employed) decided that, since most businesses fail due to poor teams and poor execution, we get the team first and the product second.

If you have an interest, contact me. RULES of engagement though:

-- Technology-based product/service

-- B2B target best but will consider B2C

-- Product has to have a large market (perhaps VC-fundable)

-- You have spoken to VCs, angels, and/or high-level advisors and gotten and taken feedback

-- The most critical component for your success is getting an experiened team

-- Willing to be based in Massachusetts
-- Pragmatic

Thoughts?

Deciding where to hang out

2009-04-18T21:30:00.000-04:00

I was having a discussion with some folks I met at an MIT Enterprise Forum meeting. We were sharing info on other meetings we knew on the same topic (fuel cells).

I hadn't heard of this meeting and asked: 'where did you learn about the meeting'? And 'how do you find out about/ decide about where to go to get good (in person) content'. So???

How do you learn of good meetings (of professionals, industry associations, etc.) in your community?

How many times a week is the right number of times to go meet, network and learn?

Mornings, evenings,... how far woulod you travel?

Monetizing social media

2009-04-11T13:22:00.000-04:00

Just like banner ads and Google search rankings, social media needs to be monetizable (in the grand sense of measurable) to be taken more seriously by many businesses.

How does one measure the efforts of companies that are active in the Social Media space?

For example, the company has employees who visit a variety of blogs with answers to questions in their areas of expertise. How can these be tracked? How do we know how many people even read each post? Needs some sort of automation, I'd think.

I worked for NetGenesis at one time. We had tools that tracked visits to a company's site in great detail....

Time to start a company

2009-04-10T19:23:00.000-04:00

Having been laid off recently, I've been going to even more meetings of professional associations than usual. There is a lot happening and it is very uplifting. An MIT Enterprise Forum meeting had a panel of experts on energy storage (fuel cells, batteries); another sponsored by MassHighTech was about clean tech; a WPI Venture Forum meeting toured the incubator (MBI) for bio-tech and med-tech companies.

I've concluded two things:
1. There is a lot of cool stuff going on and it makes more sense to go where the employed are creating than to job fairs.
2. It's a good time to start a company. In fact, many of the best companies have been started during times like these.

Care to ask me why I think this??