Posts Tagged ‘san francisco’
If you’re an avid golf fan, you’re probably experiencing a combination of elation and depression this particular Monday, following the dramatic finish of the 2012 U.S. Open held at the Olympic Club Lakes Course in San Francisco these past four days.
First, let me send out my hearty congratulations to first time major victor and 2012 U.S. Open Champion, Webb Simpson.
Though Webb has certainly had a strong showing these past couple of years on the PGA, his was not a name widely circulated as being a likely victor for this year’s championship.
And though he wasn’t widely featured on the telecast coverage through the first three days of the tournament, he slowly crawled his way up the leader board and yesterday cemented his +1 victory over fellow golfers, Jim Furyk and Graeme McDowell.
McDowell, who won his first U.S. Open at Pebble Beach two years ago, held fast to the bitter end, but his final putt wandered just a little too much to the left to earn a playoff with Simpson.
And Furyk, the grinder’s grinder, played steady and firm until that wayward hooked drive on hole 16 at Olympic, also sending his second U.S. Open Championship hopes into the rough along with his uncooperative Srixon ball.
But boy, what drama. If Shakespeare had the occasion to write about golf, he would have gotten at least a sonnet or two out of these past four days of play.
First, there was Tiger Woods’ return to rare form on day one and two, only to see him fade away into the pack with his early six over par on the first several holes yesterday.
Then there was this year’s Cinderella story, committed University of Texas (the new NCAA men’s golf champions, after a forty-year drought) golf aspiree and 17-year-old wunderkind, Beau Hossler, whose grace-under-pressure and whimsical but lethally accurate iron play left everyone wanting more. Standing ovations abounded for “the kid” by the crowds at Olympic, a kid from whom we will certainly hear a lot more and (I hope), soon.
But for my money, the real victor of this year’s U.S. Open was the Olympic Club course, and, of course, the fans.
Olympic played like a great U.S. Open course should — it seemingly brought the best players in the world to their knees, and forced them to play smart and steady golf in order to arrive on top.
That’s the kind of golf Webb Simpson (and a few others) played, and it’s the kind of golf that keeps golf fans coming back for more.
And, after Rory McIlroy’s pummeling of Congressional at last year’s U.S. Open, it was time for the U.S.G.A. to return to the essence of what makes a great U.S. Open — the matching of the best players in the world with the most challenging, but fair, golf course and playing conditions imaginable.
This year, they delivered in spades, and so did Webb Simpson.
Congrats to them both — it was a victory well deserved!
In the last keynote session before Profitero was announced as the “IBM Entrepreneur of the Year,” Garage.com founder, VC, former Machead, and all around tech cheerleader Guy Kawasaki paid a visit to speak to the gathered IBM SmartCamp finalists.
Though his talk was entitled “The Art of Enchantment,” Kawasaki, in typical Kawasaki fly-by-the-seat-of-his-pants fashion, announced he was supplanting that canned pitch with one more geared towards the gathered entrepreneurial masses, “12 Lessons I Learned Working With Steve Jobs.”
Kawasaki started his pitch by joking that he’d just been in the greenroom where the judges for the competition were gathered, and that there were five bottles of wine in there, so don’t expect a verdict anytime soon!
Then, he got semi-serious and explained he’d worked from Apple on two different occasions, 1983-1987 and again in 1995-1997, so he was uniquely positioned to comment on what all he learned from Jobs.
Before he turned to the lessons, Kawasaki suggested “the world is a lot less interesting without Steve Jobs. Most entrepreneurs would be fortunate to create one standard…Jobs created five or six (the iPhone, the iPad, the iPod, etc.)
Kawasaki went on: “I’m sure right now he’s up there telling God how to run the universe.”
Then, on to the lessons.
Number one. “Experts” are clueless. As entrepreneurs, if you start listening to all the experts, you will be led wrong. Time and time again people told Steve Jobs nobody would buy an (insert Apple product here)…At one point, even Michael Dell told Apple they should dissolve the company and give the money back to shareholders. Ignore the experts. Correlation and causation are not necessarily the same thing.
Rich and famous often equals “lucky.”
Number Two. Customers can’t tell you what they need. If you ask customers they’ll say give us better, faster, cheaper, and status quo. Build the product YOU want to use, and that you think the world can use. Fact: Nobody told Apple to build the Macintosh…iPod…iPad…
Number Three. Jump to the NEXT curve. He then explained a simple but revealing analogy. Ice 1.0, 2.0 and 3.0
Ice 1.0 was when ice harvesters sawed blocks of ice out of the lake when it was frozen and then distributed it.
Ice 2.0 saw the advent of the ice factory, so you could get ice any time of the year, and didn’t have to be in a “cold” city.
Ice 3.0 saw the advent of the “ice box,” better known as the refrigerator.
The ice harvesters did NOT embrace the ice factory, and the ice factories did NOT embrace the refrigerator. Yet, all served the same purpose: Keeping your food fresh.
So, if you want to be successful, put your solution to the problem in terms of the benefits, NOT the process you use to get there.
Number Four. The biggest challenges beget the best work. Ram a big challenge down the throat of your employees. The challenge Steve Jobs gave us was to compete with IBM. Remember the print ad we ran. It’s headline was” “Welcome, IBM. Seriously.” IBM was a magnificent competitor, and it was a great challenge for us to take them on.
So, find a mighty opposite for yourself.
Number Five. Design counts. Don’t think it’s all about price. Most people also care about design, and Apple’s premium pricing has proven that over and over again.
Number Six. Use big graphics and big fonts. Consider this slide when Jobs introduced the Windows version of iTunes. It had a massive Windows logo, then underneath the following headline: “The best Windows app ever written.
Number Seven. Changing your mind is a sign of intelligence, not a sign of stupidity or lack of conviction. When things change, you have to react and reform. Steve Jobs demonstrated this when he evolved from accepting no independent applications for the iPhone one year, to fully embracing them the next.
He saw which way the wind was about to blow, and he realized to bolster the iPhone app ecosystem, he needed to open it up to outside developers.
Number Eight. Value is NOT equal to price. Nobody ever bought an Apple piece of equipment because it was the cheapest thing.
Number Nine. A players hire A+ players. You should always be hiring someone as good or better than you in your own field.
Number Ten. Real CEOs can demo. They can run the product, show the product, build stuff with the product.
They don’t hand it over to someone else. They DO the demo.
Number Eleven. Real entrepreneurs ship. Don’t worry, be crappy.
Imagine you were the first refrigerator company. The first fridge had to be better than the best ice factory, but it didn’t have to be perfect.
Once you jump curves, that’s when the real excitement begins. When you ship, you’ll learn more in two weeks from your customers than you will sitting in a dark room.
Number Twelve. Marketing equals unique value. Pets.Com was a classic example where that rule did NOT apply.
You have a dog. You have a cow. You kill the cow, put it in the can, and give it to the dog.
That was the Pets.com business model. Shipping dog food. The problem was, it’s dead cows in cans. It weighed a lot. It was less convenient and just as expensive to order it via the Internet. It wasn’t unique. It wasn’t valuable.
And finally, number thirteen. (Never mind Guy said there would only be twelve).
Some things need to be believed to be seen.
But sometimes you also need to believe in things before you will see them.
Greetings from the City by the Bay.
It’s the second full day of the IBM SmartCamp Global Finals. I had a wonderful dinner last evening with some old friends at the Marine Memorial Club overlooking the city skyline, and this morning, woke up bright and early prepared for day 2 here at the Bently Reserve.
After a nice continental breakfast and some early morning networking, IBM’s Deborah Magid handed the discussion over to IBM’s Mike Riegel, a vice president for ISV and Developer Relations.
Riegel, who started his career in government and later worked at a startup himself, explained to the audience of entrepreneurs, mentors, press, and bloggers what was behind IBM’s investment in the Global Entrepreneur Program, which launched in April 2010, and later the IBM Smart Camp competition.
First, Riegel explained, a significant portion of IBM’s revenue is derived through its relationship with Business Partners, which come in all shapes and sizes
Second, venture capital-backed companies essentially compose the next generation of IBM’s ecosystem.
Third, through its relationships with the VC and entrepreneurial community, IBM finds new innovation, invention, and entrepreneurialism, not to mention new strategic insights and the identification of new business models and technologies. And, this past year, IBM has expanded its focus do this in markets around the globe, in particularly in emerging economies such as Brazil and India.
Fourth, and fact: VC-backed companies account for 1,500 of IBM’s Business Partners and over 30 acquisitions by IBM in the past 10 years.
So as IBM looks out at the market opportunity for some of its key investment areas — business analytics, cloud computing, smarter planet, smarter cities — well, you’re looking at several hundred billions of dollars of market opportunity, and the capital that will be invested to help provide those solutions will come from IBM, its business partners, and the new types of entrepreneurial businesses generated through the likes of the IBM Smart Camp and Global Entrepreneur program.
When IBM launched the program in April 2010, it opened its doors and resources to entrepreneurs looking to bring their next big idea to market. But then it went one step forward launching the IBM Smart Camp finals, and winner Streetline, IBM’s Global Entrepreneur of the Year in 2010, is a good case study of the potential these startups demonstrate.
Streetline was focused on “the art of the possible,” developing a very specific application that helped people find a parking space in major metropolitan areas.
In November 2010, Streetline won the first IBM SmartCamp competition. Its VC mentorship began in December of that year, and by June 2011 Streetline had raised $15M in a “B” round of funding.
By August, it had integrated its solution with IBM’s Cognos software, and then completed an integrated IBM-Streetline solution.
It was announced to the market in September 2011, and the IBM sales force started selling the “Advanced Parking Solution” by IBM IBM-Streetline.
From IBM Smart Camp winner to IBM market solution in less than a full calendar year.
This post is being dispatched by yours truly, Todd “Turbo” Watson, who is acting as a guest blogger on the IBM SmartCamp blog for this year’s IBM SmartCamp Global Finals.
If you’ve ever been involved in a start-up enterprise of any sort, you know that some of the most precious insight and advice you can get comes not from your mother (Happy Birthday, Mom!…it really was my mom’s birthday yesterday, so I had to get that shoutout out there), but rather from the people who hand out the investment checks, the venture capitalists.
And so it was at IBM Smart Camp yesterday afternoon in the 425 Market Street offices of the IBM Company here in San Francisco.
For those of you who have followed my own blog, turbotodd.com, for any length of time, you are accustomed to me writing about earthquakes when I’m such prone-ridden regions of the world.
I’ve been in earthquakes now in San Jose, Tokyo, and Beijing, all while on IBM business, but the only earth-shattering that went down today was the wisdom passed on to this year’s IBM Smart Camp finalists by the Silicon Valley VC themselves.
The “Titans of Silicon Valley,” as went the panel title.
Our VC experts included Mark Fernandes, Sierra Ventures; Mark Gorenberg, Hummer Winblad Venture Partners; Don Wood, Draper Fisher Jurvetson; and Promod Haque, Norwest Venture Partners.
Between the four of their firms, I figure they had a few hundred million (and, presumably, even billion) dollars lined up behind start-ups of every sort, and so their word was, quite literally, gold among the entrepreneurs in today’s audience, as well as we mere mortal bystanders.
The first question came from our moderator, IBM’s own Deborah Magid, who asked how our VCs typically prefer to come across their investment ideas, and the answer was almost uniform: The network.
No, not pitches via email across the Internet transom, but rather, via the vast network that each of these VCs have, where they know people they know, and the people who know them, and the hundreds of entrepreneurs who run into their circles. So if you don’t know anyone, get busy, because as Mark Fernades explained, “The referral really matters.” Mark Gorenberg piled on, explaining that “the first meeting is key. We’re looking for an opportunity for a company to be disruptive, and to have the entrepreneur demonstrate excellence.”
Don Wood had this to add: “When you have the opportunity, get in front of the investor in person. They will try to talk to you by phone, by Skype, but if you can, get in front of that partner in the firm. What we look for is the magnetism and spark of the founder. There are so many great ideas out there on paper. But it’s the person who is telling the story that matters most: Can they be a magnet to attract talent to their company, can they attract employees and those important first customers? You are the CMO for your product, so try to do it in person and “wow” them.”
So, now that we got the Woody Allen advice out of the way (“Life is 90% just showing up!”), what next?
Don continued: Be very thorough and forthright about the marketplace and the competition. If the burden is all on me to figure out the competitive landscape, or if I or one of my partners know more than the person presenting, that worries me. Be very informed and forthright. Respect the competitors, but when you do that comparison grid, be really honest. It’s frustrating if you find out someone misrepresented that landscape!
Another question from Deb: How do you get a sense that the guy or gal “has it?”
Mark Gorenberg explained simply: We have networks of people that we know. Would we send them to work for this type company? It’s hard to put your finger on it, but that way we know they’ve got a good idea.
Don Wood then added: We like to find young people who have prior experience, often in their 20s, but even those who have a couple of IPOs, they may have motivation issues. If you don’t have experience, show what you’ve done already and come in with some real progress that you can point to. If you’re a little company but you’ve caught the attention of IBM, that takes some real skill.
A round of virtual applause for all those nine semi-finalists who got IBM’s attention in the SmartCamp finals!
Don then explained that being young doesn’t hurt. He joked: We’re all old..would we ever go do a startup?
Promod joked back: Can I show you my plan? (LAUGHTER throughout the room!)
Don went on to explain: Every set of logos from Apple to MS to Dell, and they were all started by 20 year olds. Box.net was started by a 23 year-old.
Perfect segueway to tomorrow’s likely float of Facebook’s IPO, started by 20-something CEO Mark Zuckerberg!
Promod expanded on the power of youth: There are certain things with regard to experience. You don’t know what cannot be done! The ability of the entrepreneur to surround themselves with others, to collaborate, to listen to other people.
So now a finalist turned the question around: What should the entrepreneurs look for in a VC?
Mark Gorenberg: Look for value add, someone who can help open doors. We’re opportunists in a value add way. We’re primarily pattern matchers, but we can open doors, and act as a rubber wall. We can introduce you to partners, recruiting…that’s half our job, finding you people who can fill out your teams. All those parts to help you find outside board members, etc. Use us as part of your network…we should be there all the time. Are you comfortable calling the person you’re working with at 10 at night?
Having that sort of chemistry is great for a long term relationship.
Promod expanded on Mark’s response: The world is changing and the entire VC industry is changing. Some are getting larger, some smaller, some are going to disappear. If it’s a semiconductor or software company, we know it’s going to take a lot of money. We’re very mindful of the fact of how large or strong they are going to be with capital. Challenging situations: One VC is going out of business and can’t invest in the next round. Check the reputation of the board members who are going to be on your board, and have the respect of the boss. Those are the types of things you’re going to have to watch out for. Who are going to have to deal with the next 6, 7, 8, 9, even 10 years! A lot of funds are disappearing so you have to be careful who you’re choosing.
And probably some of the most insightful wisdom of the afternoon came from Don Wood, again explaining: If each fund is going to do 6 deals, and then look at a number of partners, that looks to be one or two investments per partner. You got introduced to one person, and so you’ve got to stand out to be that partners one deal for that year. So if you have the opportunity to present yourself to one partner, you’ve got to win over that one partner.
If you go into the wrong partner, or they’re busy, they won’t be a very good champion, although they might hand you over to another partner. Understand your entry point: How many investments they’ve made, how many boards they’re on, do they miss board meetings, do they send analysts to them instead, do they spend time with the company outside of the board meetings? It isn’t always the most senior or experienced partners you want, but rather the ones who have the capacity.
Mark Fernandes continued: Go look into the deals they’ve done that haven’t worked out. You’ll start to learn how that person reacts in bad times.
And sometimes, that big deal will come from the most unlikeliest of referrals, another entrepreneur.
Promod: A couple of quick examples. At the end of the day, the success of a deal is measured by the outcome of the deal you have on the financial return. There are times when you don’t make money. We were invested in a company called Yipes, around 1999-2000, and the company had a lot of debt and couldn’t raise any more money. We had to file Chapter 11, and then put more money into it. We eventually sold it, made money on second investment, but lost money overall. While we had gone through the bankruptcy situation, he referred us to another company, Rackspace, where we made $500 million.
And a good VC/entrepreneur relationship can be akin to a good marriage:
Continued Promod: When we enter into a relationship with a company, we know it could be an 8-10 year relationship. You go through all kinds of gyrations.
Don explained you have to look also at where the money’s coming from, especially these days: I think it depends on who you’re asking. Right now there are a lot of angel investors, and they’re paying a hugely important role. Their financial objective may be different than Mark’s objective.
If an angel puts in $200K, and then be sold to Google for $30M, that model works for them. Quick sale, not thinking IPO. Their model is on the shorter-term, small exits to the buyers in the market. Teams, new features, ideas, etc. IF your company is like that, your angel could be satisfied. When they’re investing $300-$500M, they’re going to be looking for individual investments that can bring in at least $100M initially, and ultimately $1B.
That means the investors will want to swing for the fences, and bypass those early acquisition factors, because that won’t make a difference for a larger fund. There’s then a scale and gradation in between those two endpoints.
Another entrepreneur’s question: How often does the startup clients play a role in the investment (customers)?
Promod responded: That helps, because that’s a validation point, and a lot of times you’re investing in companies that don’t even have a product. But, if you have a company that’s got some customers, now you can talk to that validation. We usually don’t have that luxury when we’re investing in a Series A. When we do the Bs and Cs and so on, that will help in terms of making sure money gets in and valuation goes up.
Don chimed in: Also, they’re ask who are your referenceeable customers? They’re also going to ask you if you lost any customers, and be prepared to have calls made to the customers you lost.
Mark Fernandes: Even if you don’t have customers, you’ll walk into a meeting and know whether or not they’ve got out and talked to end customers (You don’t see revenue, proof of concept, etc.)
Another question, this time on investing in Chinese startups: How do you think about companies in China, when there are companies like Google, EBay, who are not successful (unlike IBM, which has been very successful in China)?
Promod: We’re investors, and we’re investing in local China companies in the e-commerce space, a semiconductor company, and they’re growing like a weed. It’s a huge market opportunity, and we have people on the ground, growing 9-10% a year.
Don: We struck gold early on by investing in Baidu, and owned 27% of them when it public. Based on the strength of that investment, we’ve invested in the next 30, and a number of them have grown 200%, but we’re optimistic. We have an office and a local team there.
But even with that, it’s challenging, because the government can get involved or shut them down overnight. We have some R&D funds and we don’t yet know if we’re going to be able to get that capital to work in China. There’s a lot of risks there.
Q: We have our 9 finalists from around the world. What’s a quick tip you have for each of them as they make their final presentations on Thursday?
Mark Gorenberg: Get to the main points.
Mark Fernandes: Demonstrate passion and commitment.
Promod: Make sure you state the value proposition very simply.
Don: Small thing: When you’re asked customers during finals, if it’s a yes, no, question, answer it yes, or no. If it requires a numeric answer, give a numeric answer, then maybe explain briefly.
And the final words of wisdom to the nine IBM Smart Camp Global Finalists on the 20th floor of the IBM building in downtown San Francisco?
Promod: If you don’t win it’s okay, the main thing is to raise money.
I never was much one for camp, save for the Boy Scouts day camp I used to attend every Texas hot summer.
There was one particularly memorable time at camp. One of the parents was driving us home for the day, and the next thing I knew, I was rolling along the pavement.
Me, not the car. The car kept going, until the parent realized I had inadvertently opened the door and rolled out onto the shoulder of the road.
Fortunately, nobody was behind us, and I got back into the car, a little worse for the wear, and even played in my Little League baseball game that evening despite the new strawberry on my leg.
But that was a different kind of camp, in a very different time and place.
And over the past year, IBM has been holding camps all over the world. “Smart Camps,” where IBM venture capitalists look for the brightest startup companies around the world.
Because for IBM, innovation from the startup community is essential to our mission of building a smarter planet.
No company, including IBM, can all of that on their own.
So over the past year, IBM’s been searching the world for the best and the brightest startup companies.
And as I write this, I’m on my way to San Francisco, California, “startup central,” if you will, to learn more about the finalists in IBM’s Smart Camp competition, and to learn more about the innovative new solutions they’re working on to help address some of the toughest challenges cities face every day, including those like traffic, healthcare, retail, and communications, among others.
So what is IBM’s role in all this, aside from the competition itself? IBM is helping convert startups to “speedups,” by helping provide coaching and connections to IBM clients and partners.
IBM is working to help get these startups to market faster, while also providing IBM clients with the hottest new technologies.
Some Background On IBM SmartCamps
A quick flashback to see how this has fared in the past: The finalists for the 2010 SmartCamp finals went on to generate more than $50 million in VC/angel funding in the year following their SmartCamp appearance!
This week, nine technology start-ups from the business analytics realm, and from around the globe, are competing to be named “IBM Global Entrepreneur of the Year.”
These nine finalists were selected among nearly one thousand applicants, and by winning their local SmartCamp competition, earned a spot in the finals to go head-to-head with the best in the world. There were nine SmartCamps held in 2011, including in Austin, Texas; New York, NY; Bangalore, India; Tel Aviv, Israel; Shanghai, China; Rio de Janiero, Brazil; London, England; Istanbul, Turkey; and Barcelona, Spain.
Some of my favorite cities around the world!
The IBM SmartCamp Global Finals will bring together hundreds of leading VCs, industry experts, press, analysts, and academics to network and celebrate entrepreneurship.
For now, I’m going to decamp the plane and head into San Francisco, where the week’s tidings are already underway. Keep an eye on this blog for further coverage.