Chip Griffin: Pardon the Disruption

Don't Fear Failure, Learn from It

Next week I will join a panel of entrepreneurs talking to students in an entrepreneurship class at the University of New Hampshire on the subject of failure. This is a subject that numerous entrepreneurs and investors have talked about in the blogosphere in recent years. I'm certain I have even chimed in on occasion.

But in an effort to organize my thoughts to best convey my experiences, I thought it might be constructive for me to write about it first in some detail.

Different Kinds of Failure

Spectacular Collapse. When most people think of failure in an entrepreneurial sense, they likely conceive lots of money flushed down the drain, jobs lost, and doors shuttered. Indeed, these spectacular collapses often get well-reported. When companies raise millions of dollars in venture capital and go kaput, there are usually plenty of jealous folks who like to make an example of them, especially in these days of prolific social media. And it was less than a decade ago when the first bubble burst and nary a day went by without such a tale being told.

Death of a Thousand Cuts. More often a startup simply runs out of steam, the victim of a series of small failures over time. Perhaps the product never really came to fruition, the market never quite gelled, or the sales process didn't work. Regardless, eventually the company runs out of money or the founders run out of energy trying to make it succeed, or both.

The Land of Lost Opportunity. This last form of failure may not be viewed as such by many, but to my mind it is far more common than you may think. It integrates some of the same small problems that contribute to the first two types of failure, but the venture may actually survive and even make money. But it never rises to its full potential. Perhaps it was the deal that was never done -- or a deal done too soon. More likely it was a failure to invest time and/or money resources at the right time. It's like the baseball team that wins 95 games and finishes just out of the playoffs anyway. While the team played well, it is no less a failure to fall one game short than twenty.

Lessons from My Failures

I have never experienced a Spectacular Collapse, probably because I have always eschewed "vulture capital" (a phrase I picked up from a VC friend) so it has contained the fallout. Nevertheless, I have learned a great deal from the other two kinds of failure I describe above.

Get a (Business) Spouse. To my mind, it is nearly impossible to be a successful solo founder of a company. Sooner than later, you need to join up with someone just as passionate about the business as you are. Having someone to bounce ideas off of, to keep your emotions in check (never getting too high or low), and to complement your skills and personality are absolutely critical. And don't delude yourself into thinking you can get this out of an employee. No matter how good an employee you have, it's different than having a partner in the business committed to total success. To put it in crass terms to help you understand: who stood by Elliot Spitzer's side in his final hours in office? The woman he married, not the one he hired.

Your Startup Needs to be a Daily Passion. As a serial entrepreneur, this is one of my biggest shortcomings. I have professional ADD and it has probably hurt my ventures more than anything else over the years. Trying to juggle multiple startups at the same time can be a big mistake, especially if nobody is focused on each startup for the better part of every day. A startup isn't a part-time gig, even though you may need to take on side work to bootstrap your venture. At least one of the founders needs to wake up every day asking how they can move the ball forward -- and then doing so.

Trust Your Gut Instincts. I never had my heart in one of the companies I co-founded. I actually argued with one of my partners about it for months before I finally relented and agreed to start it up. I saw too many likely pitfalls and too little long-term upside. What made me change my mind? Dollar signs. The one sign you should almost always ignore. It clouds your judgment and makes you do stupid things. All that said, the business actually did darn well for a period of time, and I made decent money off of it. But ultimately it wasn't a viable ongoing business. Thus, still a failure in my book.

Fish or Cut Bait. I like to say that my first consulting business petered out because I got too busy with CustomScoop's success. And that's partly true. But what really held that company back was my unwillingness to plunge deep into the risk pool by growing it into a "real" business. I insisted on growing through the use of freelancers (and I had no partner). Had I bit the bullet and hired my first employee, that company might well still be going strong right beside CustomScoop. Ultimately, I walked away from it at its peak, and I still wonder what might have happened if I had looked to convert it from a simple sole proprietor doing consulting into something more.

A Final Word

Don't fear failure, learn from it. Whether your own mistakes or those of others, there's lots to learn. Unless you are extraordinarily lucky, you will experience failure just as I have. Treat it as an education rather than a disaster and you'll be that much stronger for it.

Making Sense of All This Startup Advice

Many bits and bytes have been spilled over the past few days about how to curb costs and get the most out of your startup team. The never-shy Jason Calacanis launched the discussion when he rattled off a series of tips for startups to make money, including some controversial ones like firing non-workaholics, buying an expensive espresso machine, and enticing employees to stay in the office longer by catering food. Most of his advice focused on saving money, however.

The Critics and Supporters Weigh In

Christopher Hawkins takes issue with Calacanis' desire for workaholics. On the 37 Signals blog, he writes that you should "Fire the people who are workaholics!" He goes on to share a number of specific reasons for his view and concludes: "If your start-up can only succeed by being a sweatshop, your idea is simply not good enough. Go back to the drawing board and come up with something better that can be implemented by whole people, not cogs."

Venture capitalist Fred Wilson offered his two cents, largely agreeing with many of Jason's points but adding one that really resonates with me: "hire utility infielders" he says. In other words, find some good jacks-of-all-trades for your startup team where you can't afford lots of specialists.

TechCrunch founder Michael Arrington says its not just about saving money, but also about hiring the right people.  Billionaire big mouth Mark Cuban (whom I admire despite the moniker) serves up his own take, focusing in part on the need for the founder to be passionate about the startup and not focused on an exit strategy. He also wisely suggests zeroing in on how to make money.

Pat Phelan chimes in from across the pond and suggests that startups look to the suburbs for cheaper office space and curb event and travel costs. (In other words, no trips to visit him in Ireland unless you can really justify it!)

Does Anything But the Product Really Matter?

Dave Winer, often a contrarian, offers up an important observation of his own, however, when he speaks of companies he has watched succeed and fail over the years.

the difference is the ones that succeed have a hot product that lots of people want, and the ones that fail don't. I don't think whether you savor every penny makes much of a difference, in fact if you pinch them too hard your people are going to hate you, and they have to love the founder, just as the customers must and the press and even the competitors.

I often find my own views at odds with Dave's but this time I have to admit I'm in agreement more than disagreement.

So What's Important Here?

Take all of this advice with a grain of salt. If you read the suggestions of all of these individuals, you will see that they disagree as much as they agree. Yet most of them have been quite successful in the startup world themselves.

You can find an expert or a successful person who will tell you that anything you believe is the right way to go. Pick up a stack of business books and some will argue for meetings and some against. Others will advocate work-life balance and some will exhort you to make work your passion.

Ultimately, you need to figure out what works for you and your startup. You will make mistakes. And others will tell you you're doing it all wrong, while some will say you "get it" (only because you agree with them, by the way).

The good news is the bad news. There's no playbook to follow. You'll be making the rules up as you go along but you'll be judged by others who may view the rules differently. Go forth, build a great product, and have fun while you do it. What happens, happens.

Are you a writer with a passion for startups?

I'm looking for a few good writer to serve as part-time correspondents for Start Rocket, my new media publication focused on high-tech startups outside of Silicon Valley.  Specifically, I need people in Boston, Chicago, Denver, New York, and Washington to start who are willing to write between 1 and 4 articles each month about startups, entrepreneurs, and VC's in their regions.  I'm also looking for others to write in specific regions (like Texas, the Southeast and Southwest) so don't feel left out -- unless you are based in the San Francisco area.  I'm trying to offer a fresh perspective on the high-tech startup scene from people in those geographic regions.

You will be paid for every article we publish.  I'm looking for high quality writing from people willing to write original stories. It doesn't need to be investigative reporting, but I'm also not looking for a story that just refers to what others have already said.  I want news, perspectives, product discussion, profiles, etc. that include original reporting.

If you think you might be interested, email me and let's see if there might be a good fit here.

A Use I Never Thought of Before

Listening to fellow entrepreneurs speak at the Defrag conference in Denver today, I realized that a lot of my brethren were uttering a phrase I often find escaping my own lips.  "My customers are using my product in ways I never thought of before."

It struck me, not because my pure brilliance is being stolen by others in the world of startups, but because it's an important point to underscore.  Successful products will almost always be used in ways that the original inventor didn't consider.  Innovation has a great track record in this regard.  Consider all of the innovations created for the space program -- from Tang to Teflon -- that have found their way into the hands of consumers for uses beyond what the scientists behind them had likely planned.

But it also should serve as a reminder to all entrepreneurs and innovators that once you release something into the wild, it will follow a path to be determined by the market and customers, not necessarily the one you had intended.  Being a successful startup demands that you prepare for and embrace the flexibility needed to follow the flow. 

Disruptive Dialogue: Chris Brogan Discusses How "Media Makers" Can Build a Real Business

Chris Brogan graciously agreed to speak with Disruptive Dialogue about his advice to "media makers" who want to make a living off of creating media.  This is a topic he has written about on a number of occasions, but perhaps most comprehensively in a blog post over the summer.

(Click here to listen to the 15 minute interview.)

In the interview, he stressed that his advice applies primarily to those who want to make money directly from their media content, as opposed to people who create media for their friends and family or even professionals who simply aim to raise their profile and build their reputation.  This is, in his words, for "someone looking to pay their way."

At first, many successful podcasters or video bloggers "lived by their show name."  Chris wanted to make sure that people understood that what they ought to be creating instead is a production company brand rather than simply a show brand. In so doing, it becomes easier to create spin-off enterprises, to sell a particular effort to another company, or fold a failure without taking the brand down with it.

In addition, Chris talked about how he has a less than 2 minute segment in each Marketing Over Coffee podcast to help build his own brand ("Social Business Class").  This represents an example of what he describes as designing content that can be "slotted in" to a larger content production.  He notes that sometimes larger media enterprises may be looking for chunks of content to incorporate into their efforts, and if a media maker creates his material in such a way that it can be easily adopted, it may be able to expand its reach through partnerships.

The comments on Chris' original post were echoed in this interview in which he discussed the fact that a successful media enterprise will often create a community which will enable revenue opportunities beyond advertising.  But fundamentally, media creators must be sure to understand the needs of advertisers and ensure that they are collecting the appropriate traffic and demographic data that potential sponsors will want to know. He laments that many content builders don't have the "business sense" that they need to make a living at what they do and urges them to gain that knowledge.

The interview then turned to a discussion of the merits of audio versus video as a business model, including a brief look at Shel Holtz's post on that very topic today. Chris noted that his original post has frequently been misconstrued to be making a case against audio in favor of video.  In fact, he notes that he loves audio-based media and that a lot of video actually works better as audio because the video doesn't add value.  In particular, we talked about the Scoble Show which we both often listen to rather than watch, although we agreed that Robert does some of his shows where the visible content adds significantly to the understanding and impact.

"I don't think people who are investing money are right now very interested in audio overall," Chris warns. He senses more innovation in the video space which excites investors, and he recalled a recent conversation where he noted how hard it is for consumers to record and post audio online as opposed to video which has a lot of consumer-friendly solutions available.

Chris notes that the Student Loan Network not only has the Financial Aid Podcast, but they also have begun to dip into video in order to do things like show how to make a perfect cup of coffee (to save money by not going to Starbucks).  It underscores his point that the future will be made up of "media makers," not single silo audio, video, or text creators.  Blended, or multimedia, offerings will be the ones that succeed.

(Click here to listen to the 15 minute interview.)

Knowing What You Don't Know

Brad Feld wrote a post recently titled "Know What You Suck At"

I don’t hear people talk enough about what they aren’t good at.  First meetings are peppered with “I’ve done this”, “I’ve done that”, “I’m good at this”, “I’m experienced at that.”  However, rarely does someone volunteer that they suck at something.  I’m often amused by the pregnant pause that comes after I ask “so – tell me something that you are lousy at.”

Brad goes on to list things he doesn't do well (including driving, which I would echo myself).  He couldn't be more right with what he says.  We all have things we don't do well, and that's why we need to be aware of them, avoid doing them when possible, and surround ourselves with others who do them better.

But just as dangerous as not admitting what you don't do well is not knowing what you don't know.  As entrepreneurs, we often have to do things outside of our comfort zone.  in the early days of a company, everyone tends to where multiple hats.  And chances are everyone is stuck with something they don't like and probably don't even really understand.

As I was setting up a new company recently, I was faced with some routine tasks that needed to be done, but because I don't do them myself regularly, I didn't know the fastest and most efficient way to get them done. Things like opening bank accounts and getting tax ID numbers for the company, for instance.  Rather than making a potentially very costly mistake, I turned to one of the guys in another one of my companies for advice and assistance to make sure it got done right the first time.

And that's what we all need to be prepared to do.  Stop and ask an expert (or at least someone wiser than ourselves) when we don't know something.  Don't guess.  Don't make it up.  Get the knowledge that you need to do the job right.

Of course, sometimes there is no right answer, no clear body of knowledge that will help guide the way.  Sometimes you must operate on gut feel, and that's OK too.  Just so long as you don't believe you know what you are doing and admit your wining it or making a W.A.G.

Scott Karp Launches Publish2

Scott Karp over at Publishing 2.0 has quit his job and is starting a company, appropriately named Publish2.  He aims to "put his money where his mouth is" by betting on the vision of the future of media that he has outlined on his blog.  His stated goal is to create the ultimate consumer-facing news site by networking online journalism (everything from "news bloggers" to more formal journalists).

The details are still a bit vague, though an invitation-only beta is slated for September.  It sounds like something similar to what I have suggested is the future of news aggregation: a cross between free-for-all ranking sites like Digg, automated ones like TechMeme, and highly edited ones like Yahoo News.  Plus it may have original content, though I haven't had a chance to read all the material Scott has put online to achieve clarity on that point.

If Publish2 really does incorporate all of these different components, then I think it has a chance to be a powerful news resources. Hopefully, it will incorporate more than just text and pictures, as my own vision for the future of media sees convergence of text, audio, and video, with the right medium utilized for the content being conveyed.

This will certainly be a company I will be keeping an eye on.

StartRocket Delayed; Cork & Knife Launches

Slight change of plans in the order of launches in the properties in the new media company I'm starting.  StartRocket, the site focused on web entrepreneurship East of the Rockies, had been slated to begin producing content this week.  However, I have opted to delay for a few weeks to address some logistical/infrastructure issues, as well as to try to line up additional contributors before going public.

While those things are getting sorted out, I decided to release the new media site that I had slotted to launch second, Cork & Knife.  This site is focused on the people that make a difference in your professional or amateur fine dining experience.  Chefs, sommeliers, bartenders, servers, authors, purveyors, winemakers, and even the food media will be profiled to help foodies and gourmets learn more about the philosophies and personalities that impact the food and wine.

So, check out Cork & Knife and let me know if you are interested in becoming a contributor to that site or especially to StartRocket. 

I'll keep you updated in this space on developments on both fronts.

Technorati Tags: StartRocket, Cork & Knife, food, wine, fine dining, foodie, gourmet, new media, New Media Cocktail, media convergence, niche media, startup, entrepreneur

How Many Different Directions Are Too Many?

I'm a serial entrepreneur at heart.  An idea guy.  An angel investor.  I love diving into new things.  I guess you could say I have Entrepreneur ADD.  I just can't help myself sometimes.  A constant in my life since 2000 has been CustomScoop. But I have had other companies that I have started and sold off (for modest amounts) or shut down.  I have helped other companies grow, some successfully and some less so.

In With the New...

And now I'm in a phase where I have several different ventures percolating.  A new media company featuring niche online properties relying on my theory of converged media that I described in The New Media Cocktail.  First out of the gate will be StartRocket, a web site focused on Internet entrepreneurship with an "East of the Rockies" perspective.  Then I have a fine dining property in the works called Cork & Knife (more on that to come in due course) that will likely exist under the same company banner.

But I also have an inkling for a couple of other companies that are more application oriented.  One is a quick, fun application that I think would have real potential viral appeal.  It would likely take off or not and wouldn't require a ton of work unless it does (but then could be all consuming to make sure it could handle the load).  Another application I'm musing about has more lasting appeal and would actually nicely complement some of the things that the new media company I'm starting will do.

...While Hanging on to the Old

Of course, I'm remaining as CEO of CustomScoop, too.  In fairness, though, years ago I got out of the day-to-day management of the company and I play more of a strategic role while serving as the public face of the company -- probably Chairman or possibly hyper-active Chairman is a more accurate depiction of my role.  And I still have this blog and my podcast (both of which have been suffering of late as I have been gearing up the new venture and writing an e-book).

Not to mention speaking engagements, conference commitments, serving as a columnist for Mass High Tech magazine, and writing numerous one-off articles for various publications.

So How Much is Too Much?

I'm fortunate in that I have a great team with me at CustomScoop that enables me to roam free.  I also have a solid team of business partners who help make these things possible through things like our angel investing outfit.  I have had the good luck to assemble thoughtful outside advisors who are always there to have their brains picked.  And, of course, an understanding family that tolerates seeing me on the road half the year and buried in work at home when I'm not in some hotel somewhere.

From time to time over the past decade I have realized that I was going in too many different directions at once and everything was suffering.  Ironically, sometimes it was only two things that had my attention.  At others, I have been able to juggle as many as five ventures simultaneously without too many ill effects.

I guess it's one of those things that you can only define when you see it -- and hope that you do see it before it is too late.  Many successful entrepreneurs juggle more than one serious thing at a time -- look at Kevin Rose with Digg and Pownce.  Or even Bill Gates with Microsoft and his foundation.  Obviously, the key is to define one's role appropriately, surround yourself with real talent, and avoid over-committing. 

It will be interesting to see if I succeed at that concept this time around.

Technorati tags: entrepreneur, team building, time management, angel investing, venture capital

Looking for StartRocket Contributors

As I gear up for the launch of StartRocket on August 1, I'm trying to line up a stable of people who will contribute to the site by writing profiles of startups and covering events.  The pay will be modest, but the exposure and opportunity should help as well.  And, of course, if this takes off like I hope it will, then the pay will be better, the opportunities will improve, and who knows -- maybe it will even become a real company with stock options and everything!

If you're based East of the Rockies, have an interest in web entrepreneurship, and are handy with the pen or video camera, drop me a note and we can connect about your interests and how you might be able to contribute.  I'm most interested in steady contributors, but if you're only able to do an occasional contribution, feel free to shoot me your idea as well.

Be sure to let me know how you are interested in contributing, why you are interested, and point me to some links of previous blogging or videos for me to take a look.  My email address is chipgriffin@gmail.com.

Technorati tags: StartRocket, blogging, video, entrepreneur

Preview from StartRocket: WebInno 13 Side Dishes

As I have mentioned in this space previously, I will be launching a new media site called StartRocket on August 1.  It will feature text, audio, and video coverage of high-tech entrepreneurship -- especially East of the Rockies.

One of the great events taking place on the East Coast are the Web Innovators Group meetings run by David Beisel of Venrock.  Typically, 3 companies get to be the "main dishes" and present demos of their products to several hundred people.  In addition, 6 "side dishes" get to have tables and briefly describe for the audience what they're all about.

StartRocket will feature coverage of these events, among many others.  Earlier this week, WebInno 13 took place and most of that coverage will appear after StartRocket's launch.  But to give you a taste of what is to come, I produced a brief video that highlights the side dishes, as well as David's introduction at the event.

The companies mentioned on this video are: iZync, TeachAde, NextCat, CurbsideMD, and Frevvo.

Technorati Tags: David Beisel, Venrock, StartRocket, WebInno, WebInno13, TeachAde, NextCat, Praxeon, CurbsideMD, Frevvo, Zync, Wade Dyke, Jeff Pucci, Dennis Underwood, Ashish Deshpande, Brad Rosen, video

Heading to WebInno Tonight

Tonight I will be in Cambridge, MA at WebInno 13, the great get together for startups, entrepreneurs, investors, and the tech-fascinated organized by David Beisel.  Looks like there are nearly 400 people planning to attend -- amazing!

I like coming to these events to get to see what's going on and catch up with like-minded people.  But tonight I'm also attending as part of my efforts to set up StartRocket, my new media site focused on web entrepreneurship, especially east of the Rockies.

I'll be recording video of the demos and looking to connect with interesting people to interview for the site.  I'll be scouting companies to profile.  And, of course, I'll be looking to spread the word about StartRocket itself.

If you're in the Boston area, come on by.  It should be a great evening. 

Technorati Tags: David Beisel, StartRocket, Web Innovators Group, WebInno, entrepreneur, startup, venture capital, angel investing

Coming August 1: StartRocket

I'm launching a new venture.  Let me tell you about StartRocket and why I'm doing it.

Lots of great web entrepreneurship happens in Silicon Valley.  There are tons of successful companies, aspiring startups, ambitious entrepreneurs, and savvy investors.  Most tech conferences are easy to get to, just a short car or plane ride away.  High-tech journalists abound.  Bloggers?  Can you really drive down the road or walk the streets of San Francisco without running into one?

After Bubble 1.0, however, the level of attention paid to East Coast web entrepreneurship diminished.  Gone were the NYC conferences and publications.  Silicon Alley Reporter disappeared.  The Javits Center in New York was no longer the home to the massive Internet World conference.  And those of us back East find ourselves forced to trek cross-country for many interesting conferences.   We have far fewer parties and networking events to attend.

These aren’t complaints, and it's not all bad.  Indeed, in some respects it signals what I think is a natural tendency of those of us on this side of the country.  Certainly up where I live in New England there's a reluctance to be flashy or toot one's own horn.  But sometimes it's necessary.

A Thriving Web World Exists Outside of the Bay Area

Great things are happening outside of Silicon Valley.  Chicago-based FeedBurner was recently acquired by Google.  CBS picked up New York’s WallStrip.  The innovative incubator/investment fund Y Combinator has had great initial success, as well, though it straddles the coasts with operations in Cambridge, MA as well as out West. 

VC David Beisel operates a successful every-other-month-or-so event known as the Web Innovators Group that hosts huge gatherings of entrepreneurs to sample startup activity in the Boston/Cambridge area.  Frank Gruber, Eric Olson, Nick O’Neill and others introduced TechCocktail to the Washington, DC community recently and it was a great success from what I understand.  And that very event started in Chicago, not on the Left Coast.

Brad Feld seems to be at the hub of the activity in Colorado, where he is involved with TechStars (similar to Y Combinator)  and is working with Eric Norlin to start what should be a great tech conference away from the West Cost in defrag which will take place this December in Denver. Fred Wilson champions the startup community in New York City, just recently hosting a Facebook developers meetup.  Also based in New York, Greg Galant has done a nice job interviewing entrepreneurs for his Venture Voice podcast, though he does seem to do so with less frequency than he used to, and I'm sure many miss it.

Obviously there's much more, but you get the idea.

Non-SV Entrepreneurs Aren't Ignored, But...

Despite all of this activity -- and perhaps in part because of it -- there remains a void.  Mike Arrington has always seemed to make a real effort to cover non-Silicon Valley startups, and as his team has expanded, they’ve done a pretty nice job of it.  (Disclosure: TechCrunch profiled CustomScoop when the blog was still a newborn.)  Robert Scoble of PodTech interviews and videotapes demos from some companies not on the West Coast, but for the most part he covers that which is close to home, and that’s understandable.  TechCrunch and the ScobleShow (as well as others, of course) provide great opportunities for exposure for web entrepreneurs.  StartRocket is inspired by those two but will complement, not compete with, their efforts.

Here's Where StartRocket Comes In

There’s really no substitute for “local” coverage of local talent.    This media site will focus on web entrepreneurship outside of Silicon Valley, and especially East of the Rockies.  It won't ignore innovation in California, it will just be more of an East Coast/Midwest perspective on the industry.

It’s more than a blog.  The future of online media involves the dismantling of artificial silos that segregate text, audio, and video.  StartRocket will use the right medium for the content being delivered.  In addition, the plan calls to roll out applications related to the editorial mission (details to come in due course).

StartRocket isn’t about me or any one person.  It’s about information.  I will continue to maintain my own blog and podcast that provides a venue for me to share my opinion, discuss my vision for the future, and other topics.  Indeed, I expect that soon I will not be the only voice sharing information at StartRocket.

Some of the things you can expect to see at StartRocket in the future include:

• entrepreneur interviews,
• company profiles,
• conference coverage,
• VC and angel information,
• product demos, and more. 

It will be a gradual evolution.  StartRocket itself is a startup activity and will follow the same evolutionary path of any startup.

Here's Where You Come In

To make this launch successful, I need to ask you to do a few things:

1. Sign up to be notified when the site launches,  
2. Tell your friends about StartRocket, and
3. Email me with ideas for companies to profile and other story tips and ideas.

Together, we can make this project a success and shine a brighter spotlight on "outside the Valley" web entrepreneurship.

Technorati tags: startups, entrepreneur, TechCrunch, ScobleShow, Robert Scoble, Mike Arrington, new media cocktail, media, online video, online news, web 2.0, high-tech startup, venture capital, angel investing, seed stage, seed funding, bootstrapping

Never Underestimate Yourself ... Or Anyone Else

Chris Brogan shared the video below of Paul Potts, winner of Britain's Got Talent (sort of their version of American Idol, complete with Simon Cowell as a judge).  Chris asks: "who are you underestimating?"

That's a great question and this video demonstrates that people are capable of surprising other people -- and even themselves.  It's worth a few minutes of your time to watch this video of a cell phone salesman who decides to roll the dice for his dream.  If you are or have ever thought about becoming an entrepreneur, Paul Potts should be someone you should think about.

The before and after shots of the judges' faces are especially priceless.

Technorati tags: Paul Potts, Britain's Got Talent, American Idol, Simon Cowell, Chris Brogan, entrepreneur, American dream

Online Social Networking Meets Old Time Neighborhood Networking

An interesting one man band in Burlington, VT is setting up an online social network focused on real world social networks of yore: neighborhoods.  Apparently some 20 percent of all of the residents of Burlington have joined the Front Porch Forum.  To me, that's a staggering statistic and once again demonstrates that online communications tools serve as an add-on, not a replacement, for real world communication and relationships. 

Robert Scoble conducted an interview with the founder of this company, Michael Wood-Lewis, and explored how the company came to be and where it is headed.  The fact that this sort of adoption has taken place with no formal marketing and just a single employee (and apparently some web development contracting) is remarkable.

I have embedded Scoble's video here:

Technorati tags: Front Porch Forum, Michael Wood-Lewis, Robert Scoble, PodTech, ScobleShow, Burlington, Vermont, neighborhoods

Calacanis Puts His Money Where His Mouth Is

Jason Calacanis has argued in the past that users should be paid for content.  He did just this at Netscape in what was viewed more as an effort to hurt Digg than to actually reward content creators, but that was OPM (other people's money).  Now comes word that he's going to do this with at his own company, so his own money (at least partially). 

Mahalo will pay users who create good search result pages:

Today I'm thrilled to announce the Mahalo Greenhouse, a place where the public can build search results that-if accepted by our Guides-will be included in the Mahalo search index.

Oh yeah, if we accept your search result we will pay you $10 to $15 per search result (the range is based on how many search results you've completed: more here).

Shrewdly, Jason is also offering to make contributions to the Wikimedia Foundation for users who don't want the cash themselves.  He writes: "We've earmarked up to $250,000 in donations to the Wikipedia this year."  Since many -- myself included -- view Wikipedia as at least partially in competition with Mahalo, this is an interesting way to crimp the complaints of the competition a bit.  It is a significant amount for Wikimedia which raised $1.5 million last year from all sources.

Good stuff.  And more proof that content doesn't want to be free!

Technorati tags: Jason Calacanis, Mahalo, Wikipedia, Wikimedia, user generated content, consumer generated media, Digg, Netscape, free content

A New Way to Grow Startup Companies

Leave it to a New Hampshire guy to shake up the way companies innovate.  James Currier, founder of Tickle, has taken his windfall from the sale of that company to Monster.com and has started a new kind of innovation incubator: Ooga Labs.

He calls it a "technology greenhouse," a hydroponic environment that harnesses so much energy and ingenuity that it can nurture a crop of companies. The 13-employee San Francisco startup currently has five stealth projects under development, including GoodTree.

Until recently, the Internet incubator was dismissed as bubble-era folly. But the comeback of Idealab, the original Internet incubator founded in the 1990s, and the early success of Obvious Corp., the San Francisco idea factory that spawned Twitter, the popular Internet messaging phenomenon that tells your friends what you're doing at any given moment, are generating renewed interest in testing many ideas at once and turning the best of them into businesses.

...

The small staff is organized into two-person speed teams, each pair an engineer and designer, who are the only employees working on one of the five businesses. They sit side by side in an open pit in Ooga Labs' Financial District office so people can get to know one another and what everyone is working on.

For my next act (or one of them at least), I've played with a similar concept myself.  I'm one of those people with more ideas than resources and I'm a firm believer in rapid development.  Since almost every startup changes course significantly over the course of its lifetime, why not admit that up-front and try a different approach?  It's what the big companies do -- Microsoft, Google, and the others all have teams of people trying out new ideas.  Some stick, some don't.

It will be fascinating to see how Ooga and Obvious play out.

(via Silicon Valley Watcher)

Technorati tags: Tickle, Ooga Labs, James Currier, Monster.com, Obvious, Evan Williams, incubator, entrepreneurship, innovation, Silicon Valley, startups, Twitter, GoodTree, Google Labs, Microsoft Research

Looking for Seed Funding or Angel Investors Outside of Silicon Valley?

Scott Burkett has a great write-up with ideas for entrepreneurs seeking early stage funding.  He writes with a geographic focus on Atlanta, but much of what he writes applies regardless of where one is located.

Raising money is rarely easy. It is even harder in Atlanta. The good news is that software/IT is a sector in which Atlanta is very strong. There are a lot of people in this city that get information technology.

Whenever the “panels” and “luminaries” are asked this question, they usually throw out the two stock answers: the 3F’s and Sig Mosley. The 3F’s being friends, family, and fools, and Sig Mosley being the unwitting godfather of early-stage technology investing in Atlanta.

If you take out Atlanta and Sig Mosley, Scott could be talking about New England as well (or many other non-Silicon Valley parts of the country for that matter).  As the managing director of a small angel group (AOS Ventures)

Last year I interviewed Matt Rightmire of Borealis Ventures (formerly of Yahoo!) and he discussed VC life outside of Silicon Valley.  He had a lot of good insight for anyone looking for funding and not located in California.

On a related note, Will Price shares some thoughts on the question "Does Geography Matter?"  There's also an Atlanta nexus in his analysis:

The most important insight for me is that the modern economy competes on innovation and that operating within a cluster shortens the cycle time to identifying, resourcing, and realizing areas of need and opportunity.

The genesis for this post was a conversation I had with two founders, currently based in Atlanta, about the merits of moving to the Bay Area to start their company. Michael Porter's thoughtful analysis helps me better understand why the Bay Area "cost premium" is well worth it. Market cap is a function of innovation and growth, and innovation is a function of access to ideas, talent, and supporting resources that eliminate frictions and catalyze connections and progress.

Personally, I waver a bit on the geography question.  Maybe I'll do a more thoughtful post on this soon, but my quick take is that while Silicon Valley offers clear benefits to Internet entrepreneurs, it also makes it harder for companies to differentiate themselves.  Does one outweigh the other?  As always, it depends!

Technorati tags: entrepreneurship, startup funding, angel investing, seed funding, Matt Rightmire, Borealis Ventures, Will Price, Scott Burkett, Silicon Valley, business strategy

Should a Startup Entrepreneur Choose DIY PR or an Agency?

Guy Kawasaki today has a guest post from Glenn Kelman, the CEO of Redfin, arguing that startup entrepreneurs should follow the DIY PR route

Nobody knows if Charlemagne could read because an advisor always read aloud for him. It was considered humbling for the king to do anything himself. The same fears drive the most captivating, articulate entrepreneurs to hire publicists. Who wants to risk looking like a fool? As a result, hardly anyone in technology ever tries to talk to a journalist by herself—except Guy, of course.

That’s too bad. Just the other day a newspaper’s technology editor told me, “It’s just so hard to meet entrepreneurs these days. You always get their PR people.” A dozen entrepreneurs sprang to mind who would kill to tell their stories. All have agencies. So what I am recommending is not howto manage an agency, but something more radical: not hiring an agency at all.

Kelman goes on to offer 10 reasons why and does a lot to take the mystery out of startup PR.  There's no question in my mind that agencies and sole practitioners offer real value.  The question for the startup entrepreneur really becomes when is it appropriate to spend precious dollars on PR versus the DIY approach? 

It's a constant battle for entrepreneurs to make these types of decisions -- when do you hire a bookkeeper or someone to do payroll?  What functions should you outsource and which ones should you keep in-house?  When does the dollar spent on a vendor provide more value than the time spent internally?  Like Justice Potter Stewart said of obscenity (paraphrasing), "I can't define it, but I know it when I see it."  Ultimately, many decisions for the startup entrepreneur are gut calls based on the best information, advice, and experience available.

Certainly, however, entrepreneurs shouldn't be afraid to do PR on their own, especially in the early stages.  If the choice is between investing in the product or investing in PR, it's a no-brainer.

I'd be interested to hear what the "wizard" (Dick Costolo of FeedBurner) thinks since he does Q&A for founders on his blog.  For that matter, Ask the VC might take this on as well to see what Brad Feld and Jason Mendelson think from the VC perspective.  And, of course, thoughts from Shel Holtz, Shel Israel, or others who have helped provide PR to entrepreneurs in the past would be interesting as well.

UPDATE: Shel Israel weighs in on this topic. Speaking of Kelman's post, he writes: "In my opinion, it's the best piece yet written on the subject."

Technorati tags: DIY PR, public relations, PR agency, PR consultant, Brad Feld, Jason Mendelson, Dick Costolo, Guy Kawasaki, Glenn Kelman

Is GooBurner a Good Idea?

Sam Sethi today starts a rumor in the blogosphere sure to spread like wildfire: Google is to buy FeedBurner.  I have no information to confirm or deny the rumor, so instead I find myself pondering whether it's a good thing.

Certainly it is likely to be for FeedBurner shareholders.  But what about bloggers, podcasters, and social media readers?

RSS feeds will continue to take on increased significance -- just as soon as we stop calling them that and make it easier and more advantageous to average Internet users to consume them.  FeedBurner plays an important role in this ecosystem as they manage feeds for a significant number of bloggers ... if not a majority of those who blog "seriously" (in other words, for business or professional reasons).

But is Google becoming a typical big company where innovative acquisitions go to die?  Certainly Google will find value in FeedBurner from an advertising medium perspective, as Sam points out.  But will they be as interested in FeedFlares?  Will they continue to be creative about feed metrics?

Small companies can generally innovate more quickly than big companies, and we have certainly seen that with Google.  There are benefits to the stability offered by a big company that tweaks and tests instead of radically innovating, but my feeling is that FeedBurner remains at the edge of the frontier and still needs that rapid innovation cycle that could be compromised under Google's guardianship.

Definitely one worth watching to see how it plays out. 

(Thanks to Bryper and CC Chapman for drawing attention to this item on Twitter.)

Technorati tags: innovation, mergers and acquisitions, m&a, FeedBurner, Google, Dick Costolo, venture capital, media consumption, advertising, new media, social media

When Does Twitter's Free Pass on Poor Performance Expire?

We in the tech community can be very forgiving of the growing pains of a startup.  Especially those of us who have been there or are there now.  That's exactly what has happened with Twitter ever since it exploded onto the scene at South by Southwest in March.  Despite my early reservations about the service, I came to adopt it and I find it valuable.  I know others do as well.

But the performance has been lagging the entire time.  Web site outages are routine.  Message deliver is delayed.  Pictures of cats fixing servers are amusing the first few times -- OK, they are still amusing -- but eventually the problems need to be solved. 

None of us who use the service pay any cash for it, but we do invest our time and energy into making it a success.  Like many Web 2.0 companies, Twitter is nothing without its users. 

System slowness made sense during SxSW and in its immediate aftermath.  What startup can truly be prepared for that sort of sudden explosion in usage?  Most established companies would (and do) have trouble with rapid traffic growth.

But the problems don't seem to be getting better.  In fact, they may be getting worse.  Neville Hobson reports today on something I have noticed myself over the past week -- tweets submitted to the system are simply disappearing into the ether, never to be seen again.  There seems to be no rhyme or reason to it.

So when does Twitter have to solve these problems before users abandon the service?  How much longer will they continue to get a free pass?  We all love innovation, but Twitter may be at risk of finding out the limits of user patience. 

This is a question all startups must ask themselves.

Technorati tags: Twitter, performance, entrepreneur, startup, scalability, infrastructure, coding, Ruby on Rails

What Kenny Rogers Teaches Entrepreneurs

This past weekend I heard Kenny Rogers' "The Gambler" and realized this song teaches us a lot about how to run an effective Internet startup.  So I dug up the full lyrics for the song and will share what I think it means for entrepreneurs.

On a warm summer's evenin' on a train bound for nowhere,
I met up with the gambler; we were both too tired to sleep.
So we took turns a starin' out the window at the darkness
'Til boredom overtook us, and he began to speak.

When you start your company, you can look forward to many sleepless nights, wondering what to do.  Wherever you think you're headed with your company in those early days, I can almost certainly assure you will not be where you end up.  Companies evolve just like people do.  Ten years ago I couldn't have predicted to you that I'd be living in New Hampshire running a successful media intelligence company, but that's exactly what happened.  Your startup will follow a similarly unpredictable trajectory, correcting its course over time if it is to be successful.

He said, "Son, I've made my life out of readin' people's faces,
And knowin' what their cards were by the way they held their eyes.
so if you don't mind my sayin', I can see you're out of aces.
For a taste of your whiskey I'll give you some advice."

Lots of people -- including me in this post -- will offer you advice for your business.  Finding your own version of The Gambler who will help you out when you're least optimistic about the future of your endeavor will be important.  Frankly, you also want that voice when you get too high on your prospects, too, as it is important to take a balanced perspective to make good decisions.  Most businesses benefit from a business partner who complements your skills and outlook.  You can go it alone, but the businesses that tend to excel usually have at least two partners to keep each other on an even keel.

So I handed him my bottle and he drank down my last swallow.
Then he bummed a cigarette and asked me for a light.
And the night got deathly quiet, and his face lost all expression.
Said, "If you're gonna play the game, boy, ya gotta learn to play it right.

Remember that you won't get this advice or partnership for free.  Even advisors who don't want cash will want to get some value out of their relationship with you.  Maybe it is relationships and networking, or perhaps it is entirely the psychic reward of helping an entrepreneur, but whatever it is you want to make sure you go into the relationship with your eyes open. 

You also need to be prepared to give in order to get.  Don't be greedy about equity.  Be willing to share it generously with partners and key employees to promote the success of the business.  It may feel at first like you're simply out of whisky, but what you receive in return may just be worth it.

You got to know when to hold 'em, know when to fold 'em,
Know when to walk away and know when to run.
You never count your money when you're sittin' at the table.
There'll be time enough for countin' when the dealin's done.

These are, of course, the signature lines of the song.  When I mentioned the song at the top of this posts, no doubt your mind went right to them.  Not surprisingly, they provide a tremendous amount of powerful advice for the startup entrepreneur.

Over the course of the life of your startup, you'll be looking at tons of deals and negotiations.  Whether it is adding a partner, hiring an employee, doing a business development deal, signing a customer, working with a vendor, lining up an investor, or ultimately selling the company, you will need to decide what a good deal is.  Some deals simply aren't worth doing, and you need to avoid the urge to do a deal at any cost.  Especially in the early days of a company or when things are going tough, you'll be tempted to say I need this customer or investor to survive, or if I don't do some deal, I will lose momentum.  Hogwash.  If you're building something successful, there is no such thing as only one way to go.  That type of thinking gets entrepreneurs -- and even established businesses -- in trouble.

now Ev'ry gambler knows that the secret to survivin'
Is knowin' what to throw away and knowing what to keep.
'Cause ev'ry hand's a winner and ev'ry hand's a loser,
And the best that you can hope for is to die in your sleep."

Just as important, you need to understand not just what deals to walk or run away from, but which projects and products to do the same with -- some will be winners and others losers.  Picking those will be a key to success.  Over the course of the nearly 10 years that I have been starting and running businesses, I have had numerous occasions where I have had a product or project nearly at completion -- or even completed -- that I have walked away from.  You need to trust information and instinct to make these decisions.  Just because you have invested heavily in creating something doesn't mean that you necessarily need to keep going forward with it. 

If you watch poker on TV, the commentators will often say that a player is "pot-committed" and therefore must continue to play the hand even if commonsense tells them to walk away.  While there may be something to this in tournament poker where it is a zero sum game, that's not how business is.  Conditions change and as you learn more over the course of creating something, you need to be prepared to shift directions, just as Topix did recently when it completely revamped its business.

so when he'd finished speakin', he turned back towards the window,
Crushed out his cigarette and faded off to sleep.
And somewhere in the darkness the gambler, he broke even.
But in his final words I found an ace that I could keep.

People with advice will come and go, but you're still on that train to somewhere with your business.  Do your best to pick out the valuable nuggets even when that person -- or blog post -- is long forgotten.

You got to know when to hold 'em, know when to fold 'em,
Know when to walk away and know when to run.
You never count your money when you're sittin' at the table.
There'll be time enough for countin' when the dealin's done.

When the time comes that you are contemplating selling your business, wait until the deal is done before you start picking out cars, boats, and houses.  As our company attorney once said to me, when you start spending the deal money before you have the check in hand, you make bad decisions on the deal documents.  He shared one case in particular where an entrepreneur already had picked out an expensive sports car, and therefore caved in on all the key deal terms simply to get the check.

Similarly, be careful that you don't begin to believe your own hype.  There are plenty of entrepreneurs who ended up broke because they saw dollar signs and stuck around too long.  Unfortunately, there are probably just as many who exited too soon and didn't get the big payday they might have.  Figuring out when to exit will be one of the toughest things you ever have to do.

Hopefully, in the end, the company won't die in its sleep but will instead give you a nice, satisfying exit.

Technorati tags: Kenny Rogers, entrepreneur, startup advice, Internet startup, The Gambler

You Can't Really Know It If You Don't Do It

Some great advice from Charlie O'Donnell:

I think marketing & PR firms, VC firms, anyone who has any kind of business interest whatsover in social media needs to mandate that the decision makers on your staff, right on up to the top, all "walk the floor".   Maybe Fridays should be "social media days" where the whole office plays in MySpace, Second Life, blogs, plays World of Warcraft, Twitters, etc...   Like Google's 20% time.  Take some Flickr photos, poke some people in Facebook...   

I'm not sure an entire day every week is required -- I think that depends on precisely how social media fits into your company and job.  But I do believe it needs to be a significant investment by everyone involved.  More important, it shouldn't be mandatory.  If employees aren't interested in social media and inclined to use it of their own volition, they may not be the best fit for a social media-focused company or job position.

This is the same reason why most managers and coaches are ex-baseball players.  It's hard to coach a team if you haven't been there yourself.

(via Brian Oberkirch)

Technorati tags: socia media, employees, employee training, Charlie O'Donnell, Brian Oberkirch

What to Measure When Growing a Company

Dick Costolo has an interesting post on how and what to measure when creating metrics to judge company progress.  It also spawned a few interesting comments ... including the argument that measurement doesn't work.

Technorati tags: Dick Costolo, entrepreneurship, company growth, measurement, metrics, sales

What Baseball Teaches Us About Business

Ah, the first day of spring is upon us.  It doesn't quite feel that way here in New Hampshire where it is about 19 degrees with lots of ice and snow on the ground (and more ice reportedly on the way).

Nevertheless, Brian Oberkirch got me in the springtime mood with his post today that shows the lessons that baseball teaches those of us in business.  So go read his post and then come back here to read my additions. 

Brian's list is excellent and I agree almost uniformly with everything he wrote.  I do have 10 of my own to contribute, though:

• It's Not All About Superstars.  You need a solid team from top to bottom.  Having one superstar and a bunch of also-rans won't get you as far as a team full of solid performers.  Remember that especially if you have a top performer who doesn't play well with the rest of the team.
  
• It's Not All About Money.  Billy Beane and Moneyball anyone?  In business that means you don't need lots of VC funding to compete with the big boys.  You need a great idea, passion, a solid team, and excellent execution.
  
• Pitching Matters in the Playoffs.  Once you reach the post-season, you can't expect to bash your way through games.  The competition is tougher and it will likely come down to pitching.  Your business has some component that rises above the others in its significance.  Make sure you invest properly in it, whether it is technology, sales, customer service, etc. 
  
• Free Agency Rules.  Players want to go where they are well-compensated, appreciated, and can win.  You need to create the same environment for your employees.
  
• It's a 162 Game Season.  You need to try to win every game, but you won't.  Pick yourself up, dust yourself off, and play the next game.
  
• You Need to Know How to Bunt.  Even my beloved Red Sox who in recent history have avoided the bunt like the plague occasionally need to employ it to win games.  It's not sexy, but it is necessary.  Remember all that hard, boring stuff in your business and don't ignore it.  If you can't bunt, make sure you have a specialist on your team that enjoys it.
  
• It's Not Just About Tickets Anymore.  Major League Baseball teams couldn't survive on individual ticket revenue alone.  That's why there's club seating, outfield advertising, stadium naming rights, merchandise deals, TV deals, etc.  Don't forget you might be able to find non-traditional revenue streams, too.
  
• The Brushback Pitch.  Most of the time players accept the brushback pitch with a glare and move on.  But sometimes they fight back.  Fighting is costly, so you need to pick your battles wisely.  Sometimes you're better off filing the information away for later use.
  
• Six, Two and Even.  The "other" Joe Morgan -- he who managed the Boston Red Sox in the late 80's and early 90's and was known as Walpole Joe throughout New England -- famously said "six, two and even" a lot, usually to reporters.  Nobody ever knew what it meant, but it kept 'em guessing.  A little mystery is healthy for any business.
  
• Keep It in the Clubhouse.  Baseball managers try to keep the private business of the team private.  When reporters start sniffing around about internal disagreement, many managers will say "we're going to keep that in the clubhouse" or some variation of that.  Businesses would be wise to do the same and not let dirty laundry or simple dissent come out in public.  It's family business and should stay that way.

Thanks, Brian, for putting me in the mood for spring.  Opening Day is just 12 days, 1 hour, 12 minutes, and 5 seconds away as I write this...

Technorati tags: Brian Oberkirch, baseball, spring, business advice, entrepreneur, startup advice, opening day

So You Want to Build a Big Ad-Supported Web Site? Think Again

Today the New York Times points to an excellent blog post by Jeremy Liew of Lightspeed Venture Partners who details 3 ways to get to $50M in annual revenue with an ad-supported web site.  The bottom line is that it takes a lot to achieve it.  He thinks it is hard, but doable.  Jeremy says in the comments he thinks that a niche site is most feasible, but would still need to achieve 200 million or more page views every month in order to hit the goal.  If you're building a site with more general appeal, you'd need to have in excess of 4 BILLION page views per month to hit those kind of revenue numbers, according to Jeremy's calculations.

Unless you really think you'll be one of the handful of players to achieve these numbers -- and you may well be -- then you need to either set your revenue sights lower or you need to come up with a different model.  Just about a year ago, Fred Wilson raved about his favorite business model, which includes a mix of revenue streams sitting on top of a free service. 

To me, though, it also points to the need to think through revenue models before you start your business.  I know that it is fashionable to argue that with low startup costs today, you can just start your web site up and figure out how to make money after you get traffic.  Baloney.  You should have an idea as to how you plan to make money because how you structure the site may change based on your plans.  Now, you need not stick with that model as time passes if you have a better idea -- and in fact in most cases how you make money 12 months into the adventure will not be the same as what you predicted.  That's fine and expected.  But don't subscribe to the "build it and revenue will come" school of thought.

Technorati tags: Jeremy Liew, Lightspeed Venture Partners, Fred Wilson, business model, advertising, web traffic, page views, entrepreneur, venture capital

Companies and People Make Mistakes

An excellent post from John Moore at Brand Autopsy reminds us that every company makes mistakes. 

No business is perfect. NONE. Business is a game of progress, not perfection. No business will be perfect. It's an impossibly unattainable goal. But while that goal is unattainable, the most endearing and enduring businesses seem to always aspire to reach perfection. They always make progressive steps to improve their business and how their business connects with people. Sure, they will stumble along the way. But the true measure of a company is how they recover and forge ahead making progress along the way to overcome their mistakes.

Every company I've ever worked for or owned has made mistakes.  I've made mistakes personally.  What I always tell employees is that I don't mind mistakes, as long as they are honest ones.  Typically the only ones that get to me are ones that are repeated.

Make a mistake, make amends, and don't make the same mistake twice.

Technorati tags: Brand Autopsy, John Moore, mistakes, customer service, entrepreneur