VV Show #60 - Larry Kramer of MarketWatch
Today's media executives plotting to charge for their content would do well to hear how Larry Kramer beat Jim Cramer's TheStreet.com by resisting pressure to put most content behind a pay wall while not relying entirely on advertising. To the average consumer, MarketWatch.com seemed to have come out of nowhere during the late 1990s to quickly establish itself as one of the leading sources of online financial information. For MarketWatch founder Larry Kramer, it represented the last chapter of his 15 year journey as a first-time entrepreneur. Larry started his career as a journalist, going from reporter to the top editor of the San Francisco Examiner in just 10 years with stops at the Washington Post and Trenton Times along the way. Larry founded DataSport Inc. (the company that would eventually morph into MarketWatch though a series of mergers and partnerships) with $500,000 from friends and family. He almost ran out of money early on. After a wild ride on the public market, Larry sold MarketWatch to Dow Jones for over $500 million in 2004 and went on to become the president of CBS Digital Media until 2006. Hear how Larry lived though two different careers and what he's planning next.
1:30 Roots in Journalism, from paper boy to the Associated Press
3:25 "My whole career has been a series of breaks."
5:20 Covering Woodstock
6:00 Entered Harvard Business School to write about business
6:55 Experiences at The San Francisco Examiner and The Washington Post
12:00 From cub reporter to Editor-In-Chief
16:00 A move into industry at Data Broadcasting, maker of real-time stock quote delivery hardware broadcast over FM radio
18:00 Spun DataSport out of Data Broadcasting, adding sports to the signal during nights and weekends for "displaced fans"
21:30 Raised $500,000 from friends and family, "which I'll never do again," and partnered with The Sporting News for branding and marketing
24:40 Last minute feature: betting lines from Vegas, the "lifeblood" of the product
25:20 "So we ended up with a lot of gamblers as our customers."
25:45 Profit on paper, but running out of cash
26:50 DataSport purchased by Data Broadcasting
29:30 "Skunk works" internet project, DBC Online, building financial websites for newspapers, first client: USA Today
33:00 Spun out DBC Online and opened the site to everyone, monetized via advertising, partnered with CBS to create CBS MarketWatch
36:45 Incubating a new business within an old one
39:00 Pierson, owner of the Financial Times, buys DBC for its share in MarketWatch
42:00 An IPO at the height of the boom: $7M in sales but a $1B market capitalization
50:30 "I was worth $20M on paper that day."
52:40 Bought Big Charts for $160M with MarketWatch "currency," i.e. stock, for a second revenue stream and infrastructure
55:10 Big lesson from Big Charts: "have as many revenue streams as you can"
59:40 Sell the news but not the editorial expertise
1:00:20 Licensing news on other sites brought in another revenue stream, which allowed the site to survive the advertising slump
1:01:00 Competition with TheStreet.com
1:03:50 "Bloomberg is a fine business and makes a fortune, but they're a rarity."
1:05:15 "You need to be in the free universe to be searched, to be all the things that cause you to grow and gain stature in the world today."
1:08:15 On cash: "Your investors don't want you to be a bank, they can put their money in a bank."
1:10:15 On Dow Jones offer: "If they don't buy us they're going to compete with us."
1:11:30 The bidding war for MarketWatch ends in a $528M offer from Dow Jones
1:15:10 "When you get money, you immediately meet people with a lot more money."
1:18:00 Writing a book on the effect of the internet on not only media but all industries, "what's happening today is as big as the invention of the printing press"
1:21:40 "The biggest problem is companies trying to protect their business models not their products."
1:22:25 What's your ambition now? The book, journalism, teaching, corporate boards and "sharing what I've learned"
VV Show #59 - Barry Silbert of SecondMarket
Any shareholder in a startup can tell you there's a big difference between paper wealth and cash. Short of an IPO or outright acquisition, there are few options to cash out for the shareholders of even the most thriving private companies. Barry Silbert is determined to change that with his company SecondMarket -- an exchange like the NASDAQ for private stock and other illiquid assets. He founded the company in 2004 focused on restricted stock, and quickly reached profitability with only $350,000 in angel funding. The road to this point was not without challenges; Barry's business partner was diagnosed with cancer and passed away as they were establishing the company. In 2008, SecondMarket made $20 million in revenue. Barry's success has not tempered his ambition as he's spent 2009 aggressively moving into new asset classes such as private companies (Facebook stock is already being traded on his platform), limited partner interest in venture capital firms and even California IOUs. Hear how this former bankruptcy banker did it and why he believes "The sky's the limit" for his business.
2:20 Early interest in entrepreneurship
2:50 Life after college: Bear Stearns, Smith Barney, & Houlihan Lokey
5:00 Why the switch to entrepreneurship?
5:15 His family thought he was crazy to leave banking to start a company: "I never told [my now-wife and family] how much money I was making [as a banker] until I had left"
6:15 The need for an illiquid asset market
8:30 Advice: Don't raise money. Don't build tech. Just start doing these transactions
10:00 Raised $350,000 in angel financing for SecondMarket
11:15 Early success in blocks of restricted stock
13:00 Matching buyers and sellers with a spreadsheet
13:50 Standardizing legal paperwork
15:15 Technology needed to scale was internal not external
16:30 The early team
17:15 Built first trading system in 2006
18:10 Revenue ramp: $1M in 2005, $2.5M in 2006, $5.5M in 2007, charging between 2-4% in fees
22:50 The passing of a partner
28:15 The value of marketplaces
29:15 "You're going to make hiring mistakes."
30:20 Raised $3.8M from FirstMark Capital for 25% of company, yielding a valuation of $15.2M, to apply the same model to different asset classes
31:55 $20M in 2008 revenue
32:15 A major opportunity in auction rate securities
37:15 New initiatives (asset classes) for the company: bankruptcy claims, limited partnership interests, toxic assets, private company stock, California IOUs
40:30 On launching a new market: "Generally speaking, it's not very expensive for us to start a new market."
41:50 On the private stock market: "This is the market we're most excited about right now."
43:10 "We've become the ad hoc market for Facebook stock."
46:00 "We've opened up SecondMarket to venture backed, private companies who want to raise another round."
50:25 "Private companies are staying private longer."
54:30 $1.5B in transactions in 5 years, $1B in last 12 months
59:20 How big can this market be? "The sky's the limit."
1:00:00 What do you spend your time on now?
1:01:20 "We have no plans to go public."
1:02:20 Parting thoughts for listeners
VV Show #58 - Siamak Taghaddos and David Hauser of Grasshopper
"Dial 1 for sales, dial 2 for support..." Ten years ago it cost over $10,000 to get a phone system with the advanced options we're used to hearing when we call big companies. Having a professional-sounding phone system was a surprisingly big challenge for small businesses short on cash. Enter Siamak Taghaddos and David Hauser who launched GotVMail to offer that service at rates starting at only $10 per month in 2003 as they were graduating college. They launched their business with under $200,000 in capital and never raised any more money. They bootstrapped their way to profitability quickly, and are now driving over $10 million in annual revenue. Despite their success, Siamak and David don't believe what's gotten them this far will take them to the next level. So they've just rebranded their company Grasshopper and are getting ready to launch some new products.
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3:15 Discovering a mutual love of entrepreneurship at Babson College
4:30 Entrepreneurial roots in cellular pager distribution and Return Path
8:00 Similar business models leads to a partnership
11:15 "It took us six months from shaking hands to turning up out first customer."
11:40 Early operations, developing the product, and balancing school
13:45 Low capital requirements (under $200k) through smart vendor deals
15:40 On falling technology costs: "If whoever is listening wants to get in the space and compete with us, you can do it a lot faster, easier and cheaper than we did."
16:10 Simple feature set allowed for easy building, but marketing took more thought
17:05 On marketing to entrepreneurs
19:10 "90% of [costs] went to developing the infrastructure."
21:00 Working with Google Adwords
24:20 On trust and working together
27:00 "We were never friends to begin, so there was never that conflict."
28:40 Advice for choosing business partners: "Find a partner that's an entrepreneur, and doesn't play a specific role."
30:15 Life after break-even
31:45 The continuing benefits of bootstrapping and a limited budget
35:30 "We've stopped outsourcing anything related to creating a brand."
39:30 On plateaus
42:30 From GotVMail to Grasshopper: "Forget telecommunications, but create a brand for entrepreneurs that provides tools and services that empowers them to succeed."
45:30 Why the Grasshopper name?
52:30 Maintaining growth and agility
53:45 Grasshopper today: 50 people, mainly tech; HQ in Needham, MA; office in Austin, TX
55:30 Getting the name out
1:01:15 Grasshopper as the "Virgin" brand for entrepreneurs
1:05:40 Future goals
VV Show #57 - Fabrice Grinda of OLX
Craigslist seems unbeatable. It's often blamed (or celebrated) for destroying the classifieds business that helped keep American newspapers afloat. Now second-time Venture Voice guest Fabrice Grinda is seeking to dominate online classifieds with OLX, his latest venture. Unlike Craigslist, OLX is translated into many languages and has a global focus. OLX is completely ad supported so there are no fees for job or real estate listings as there are on Craigslist. Still, it sounds crazy to compete with Craigslist. If anyone can do it, it may be Fabrice. When we interviewed him in December, 2005, it was on his last day working as CEO at Zingy, a ring tone provider that he founded and sold for $80 million against all odds. OLX already has 125 employees and 60 million unique visitors per month, but with $28.5 million is venture capital it has a lot of growth ahead of it before it's a success. Hear how Fabrice plans on getting there.
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Listen to the first interview with Fabrice on December, 2005
Read about OLX's launch in early 2006
A tour of Fabrice's office (listen to audio above for full interview):
0:02:39 Background, taking US internet ideas abroad
0:04:19 Creation of Zingy, bringing mobile content to the US in 2001, mostly with own money
0:05:04 Sold Zingy in 2004 for $80M, stayed on afterward.
0:07:04 The transition from owner to employee
0:08:44 Lessons from the sale
0:11:54 Owned over 50% of Zingy at time of sale
0:13:29 Life after Zingy, traveling and convincing friends to join the next startup, OLX.
0:16:29 OLX: "free classified for the world"
0:17:14 OLX plays on five trends: 1) movement toward online media consumption, 2) movement toward online advertising, 3) transition to ad-supported business models, 4) faster growth in developing world, and 5) transition to paid classified verticals in developed world (ex: HotJobs) while developing world still depends on newspapers.
0:18:34 "Let's build Craigslist 2.0 for the world."
0:19:14 Working from NYC with a team in Argentina lead by partner Alex Oxenford
0:20:24 Incorporated in March, 2006
0:22:44 On running an international startup: "It hasn't been that complicated."
0:26:19 On missing the office.
0:28:44 OLX today: live on June 1, 2006; 125 employees, 87 countries, 39 languages, 60M unique visitors/month
0:31:54 "At the beginning, you just want to keep it simple."
0:37:04 "We're not about to run out of ideas, because the vision here is how do we take a free classified site, that's horizontal and present in every category, and make it as good as every paid vertical site."
0:38:14 On competing with focused verticals: "Differentiation number one: we're free."
0:40:24 "Things that work in one country, typically work in another. That's true of the idea as a whole, it doesn't mean the execution of the idea is identical."
0:43:19 On buying international domain names (shout out to marcaria.com)
0:47:44 Financing OLX: first $500K self-funded, VC follow-up at a "very generous offer"
0:49:09 $10M Series A round in Fall 2006 and $18.5M in early 2008.
0:51:49 On boards and VCs.
0:58:44 Threats to OLX: 1) deep-pocketed competition 2) market risk of low global CPMs and currency fluctuations
1:03:14 On the ease of marketing with Google
1:05:19 "Google is a curse and a blessing."
1:07:39 What's next for OLX?
1:10:54 "As an economist, this is a dream job."
1:11:49 Advice for current entrepreneurs: "Now is the best time to start a business."
VV Show #56 - Joel Spolsky of Fog Creek Software
Joel Spolsky first came on Venture Voice over three years ago to discuss his company which he launched in a very different way from most entrepreneurs. Rather than start with the big idea and pay lip service to building a great team, Joel focused on getting great programmers first. The ideas came second. Good thing because his big idea, a content management system called City Desk, never took off. Instead it was his small idea, software to track bugs in other software called FogBugz, that became a cash cow for his company Fog Creek Software. This small idea has provided the funding for his company to expand into three other product lines, all with just $50,000 in seed capital from Joel's savings account invested when Fog Creek was started. Since we last caught up with Joel, he's moved into a new office in Lower Manhattan that sports closed offices for all of his programmers and a large area where free lunch is served every day (eat your heart out Google). Listen to how Joel's expanded his business.
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2:25 Original vision for Fog Creek Software (now four products: Copilot, FogBugz, Stack Overflow, and the Joel on Software Job Board) - listen to Joel's first interview on Venture Voice in 2005
3:35 From content management to bug tracking software
4:35 "Content management was taken over by blog tools."
5:05 Copilot: remote tech support tool, grew out of an internship project.
6:30 Shifted Copilot from a day pass to a subscriber model
8:00 "FogBugz is the cash cow."
8:45 On developing products with interns
10:35 Managing many products vs. few
13:40 Copilot today: "growing well... a nice side business"
14:25 Zero marketing: "We've experimented with AdWords and never got anywhere... There are certain categories for which it works and a certain category of thing for which it's a waste of time."
15:10 FogBugz: Bug tracking and coordination software
15:50 Licensing vs. Software-As-A-Service
17:05 On the fear and need for data security in online services
20:05 "We probably run FogBugz a lot better than our customers can... That is not necessarily true of other software-as-a-service providers."
21:50 "Because we were a bootstrapped company, we had to reach a certain critical mass before we felt we could host FogBugz at the level of quality our customers expect."
22:20 If creating FogBugz from scratch today
25:10 "If you're in a business with network effects, you probably want to get big fast, and that means you want to get outside investment... and you also want to take a lot of risks."
25:50 "It's a lot easier to start a software-as-a-service business today."
26:50 "We don't try and predict the future."
29:00 More revenue per user via software-as-a-service.
30:25 The economic downturn hurts new subscriber growth, but current subscribers still pay.
31:40 "As a startup, I would not build something to be installed locally."
36:35 "We don't really make deadlines. We just try to estimate when something is going to happen."
39:50 Stack Overflow: "programmer Q&A website where programmers ask questions and get answers."
45:55 "I pretty much ignored all of my rules when I built Stack Overflow."
47:00 600,000 page-views per day, closing in on 300,000 visits per day, that number is doubling every 4 months
51:00 86% of Stack Overflow traffic comes from search, because the site was built for search from the ground up
58:15 On Fog Creek: "We're the beacon on the hill."
59:25 On prioritization
59:50 "We don't have any kind of outside board of advisors."
1:01:10 Big projects for this year: FogBugz 7, new features in Copilot, Business Software conference, Stack Overflow World Tour, software development documentary
1:07:35 Parting thoughts
VV Show #55 - Graham Hill of TreeHugger
Graham Hill started the blog TreeHugger to cover green issues in 2003. After a steady climb in traffic and advertising, Graham sold the company to Discovery Communications in 2007 for $10 million. Since launch and even after the acquisition, Graham ran his business virtually. Graham lived in different cities from New York to Barcelona while working many hours to grow his company. His team of writers, ad sales people and developers chatted over Skype, got paid through PayPal and used Google documents to collaborate. Simultaneously, Graham launched a ceramic version of the iconic New York paper coffee cup (video below). Listen to how Graham built his businesses without an office or home town.
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2:30 Studying architecture and product design at Carlton University & Emily Carr University of Art + Design
3:20 Ceramic coffee cups replicas at We Are Happy to Serve You, launched late 2003
6:30 Started a web development firm, sold for "millions of dollars."
8:45 "As a boyscout I would sell the most calendars... I was a good salesman."
10:20 Regarding the coffee cup: "I was very persistent in finding out who had the license."
11:55 "Once we got the MOMA, everything changed."
12:20 "It's a consistent theme. I look back at Siteworks, the web development company. When you get that key client, it really changes things for you. When we landed Microsoft it made all the other sales that much easier."
15:50 The origin of TreeHugger
18:15 On TreeHugger: "It's pretty much what I set out to do."
18:18 "Green equaled hippie."
19:13 "So I wanted to, basically, make green cool and convenient."
22:00 "I think that for-profits play a really important role in socially, environmentally progressive areas... The advantage is that, as we start to get some traction, we prove that there's a market there."
24:48 "You want to set the DNA for the company being scrappy."
25:20 Launched TreeHugger on "a couple grand"
28:00 Price per post: "started at $10 & $15... [now] a bunch up from that"
28:35 On-site advertising: "The ads should be part of the content."
33:00 On working virtually
33:45 "Paypal made the company."
35:30 "We've put some effort into marketing but it's never really worked that well."
36:00 Virtual Tools: GMail, Google Docs, Paypal & Skype w/ "water cooler"
40:45 Does it get lonely working virtually?
41:50 TreeHugger stats: Reached profitability in 2006, prior to acquisition, on $150,000 out the door. Hit a "couple million" pageviews a month. Monetized primarily through advertising using a number of ad networks. In 2007, 60/40 direct ad sales/ networks. Did well with AdSense, "green is good."
46:20 Work-a-holic: "The concept of taking a weekend off is still a new one."
46:45 "My role is taking something from nothing to something... That my interest. That's where I add value."
48:30 Discovery acquires TreeHugger
50:15 Mechanics of an acquisition
50:40 "We could bring on a banker, but we wouldn't be a big deal to them."
54:50 TreeHugger acquired for $10MM
57:15 Thoughts on the future
57:50 Planet Green: "The first 24-hour eco-lifestyle channel" and website from Discovery. "Planet Green is about getting people to take action."
58:50 What gets you excited? Aviation: "I can be green in most of my life, except flying is a very hard thing for me." Also, kite surfing.
1:00:30 Parting thoughts for entrepreneurs: 1) "Raising money can be dangerous." 2) "Do something you're really interested. It is said and it can't be said enough." 3) "Most of the people listening to this... don't have a lot to lose... so take some risks."
VV Show #54 - Tim Westergren of Pandora
It takes only a few seconds to customize a radio station on Pandora. Its founder Tim Westergren has been struggling for almost a decade to make it that way. Pandora was five years in the making before it streamed a single song to a user. For over two of those years the company was completely broke. While Tim convinced employees to defer over $1 million in salaries, Pandora underwent several changes in name, product and revenue models. Now Pandora is a leading online radio destination that’s starting to bring in sizable ad revenue. Tim is still battling with the record industry for its survival.
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2:40 - Studying music technology at Stanford
4:30 - "The world of the working musician" and the advent of desktop recording
5:45 - The Music Genome Project, the underpinnings of Pandora
8:15 - Early entrepreneurial experience: band manager and self-employed film composer
8:50 - Single greatest challenge of building a business: "Attracting, retaining and managing the best talent you can."
9:40 - Writing the first genome and starting Savage Beast Technologies (the precursor to Pandora) - "the first phase was euphoric"
12:10 - "We thought we were building a recommendation tool for other businesses."
12:45 - "A year after we started, we began to sense that money was going to be a challenge."
14:30 - Bank account at zero
15:40 - "The company deferred about a million and a half dollars of salary. So, people really did sacrifice an awful lot."
17:40 - "In 04 when we finally raised a big round of investment... we had no business. We had this incredible piece of intellectual property."
19:10 - "Music discovery... is a huge problem and there's a big appetite for it... and this thing we build was the perfect way to solve it. So, we just had to figure out how to bring it to market."
19:45 - Why were you able to raise money in 2004 and not 2002?: 1) Impressive client list 2) "We had demonstrated a real entrepreneurial ability as a company."
21:55 - "I can't blame anyone who, back then, decided to quit. That was a perfectly rational decision."
22:05 - "The company should not have survived. Really, we were dead. We were financially insolvent on paper for two years."
23:35 - Raised $9MM in 2004 with a focus on web enabled kiosks for record stores.
24:00 - Hired Joe Kennedy as CEO, "re-purposed the business for radio."
26:10 - Leaving the CEO role: "It's not a job that I really wanted."
26:50 - "My time is best spent doing strategy and evangelism."
29:20 - Building and launching the new product, Pandora.
32:15 - Limited release in Fall 2005
33:00 - $12MM round in November 2005, went "free" shortly after and "took off like a rocket ship."
34:00 - "We've never spent any marketing money on Pandora... Gave it to bloggers and they became our evangelists."
36:00 - "If you make good choices with your personnel and your product, they tend to line up."
36:35 - "Growth was our focus in the beginning, growth and also the building of a brand and our identity."
37:50 - "Now we're at revenue per hour. That's an important metric for us."
38:55 - "We thought it was going to be a subscription business" "It was pretty clear, people weren't going to pay for radio."
41:00 Question for Tim from VC Martin Gedalin submitted over Twitter: "How can you create ad engagement with naturally disengaged audience?"
41:30 - Pandora audience: surprisingly engaged, "comes back to the site six times an hour."
42:15 - Doubling annually, $20MM in revenue last year, "it's all going in the right direction"
42:20 - "It takes a lot of effort. We have a 45 person advertising sales team."
42:50 - "We're not profitable but that's largely due to the performance fees we pay, the per-song fees."
43:10 - Industry and rate structure
44:55 - "Pandora was the only company that would be able to fight this fight."
45:50 - On audio advertising
47:00 - On the recording industry and the RIAA: "I think we're part of the solution, not the problem."
47:40 - "The business doesn't support the level of taxation they're pushing for."
49:15 - On starting a business in the music industry (responding to Venrock VC and former eMusic CEO David Pakman's post): "There are lots of landmines."
50:55 - Current snapshot of Pandora: "We've built a genuine ad platform."
52:00 - "I'm confident [the licensing issue] will get resolved. Nobody stands to gain by not resolving it."
53:00 - "We see an opportunity to really redefine radio and do it globally, and do it in every musical genre... and to, at the same time, change the plight of the working musician."
VV Show #53 - David Cohen of TechStars
The title financier conjures images of mahogany desks and million dollar checks for most. But for anyone pitching to David Cohen's TechStars, the outcome is getting accepted to what's essentially a summer camp for entrepreneurs in Colorado and being offered a check of $18,000 or less in exchange for 6% of the startup. This two year old program is part of a new trend in structured angel investing and mentoring that was started by Paul Graham's Y Combinator. Two companies founded at TechStars have already been acquired: socialthing! was sold to AOL and Intense Debate was sold to Automattic (the makers of WordPress). David tells his own stories of success and failure as an entrepreneur, and his transiton to becoming an angel investor.
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2:30 Entrepreneurial beginnings
3:00 Pinpoint Technologies, sold in 1999
5:10 First foray into angel investing: "To me, the first year of every company I've done is the most fun."
6:05 Angel Investing 101: "Your first deal as an angel investor is about learning."
9:30 Evolution of an angel: "Wanted to see more deals... and invest outside of Colorado."
11:30 Typical angel investment: "Pre-revenue is the norm."
12:50 Birth of TechStars
14:25 Original Investment in TechStars: Under $250,000, "I was just doing it for the equity."
16:15 "The earlier the better. If you're passionate about starting a company, go do it now. It's only going to get harder..."
17:00 The TechStars pitch: "TechStars is not about the money... it's really about the mentorship we provide... we like to be viewed as a co-founder."
19:15 Why 5% equity: "It felt right and it's proven right."
21:10 Response to the low valuation argument
22:15 Seed funding and geography: "You can't do it anywhere, but you could do it in any reasonable start-up community."
23:55 The TechStars experience
27:00 Current state of TechStars
28:10 Status of the first class: 10 companies, 2 acquisitions (Social Thing, Intense Debate), others doing well (Filtrbox, Brightkite), one defunct
31:50 Hidden benefit of TechStars: free/streamlined legal services
37:05 How to justify an angel round after TechStars: "I don't think it's enough anymore, with most investors, to just say we're going to build something that everyone's going to love... and we'll figure out how to monetize it."
38:30 Trends in team composition: "The sure thing with a software company is you better have at least one, true rockstar developer who's really committed and vested."
40:40 How to find rockstar techies
42:00 TechStars and the current economy: "Good companies are still going to get funded. So it's more important than ever to build a good company."
45:14 Applying to TechStars: Applications opened January 19th, close March 21st. Simple application with 15 questions. Video submissions now accepted.
47:30 "The model beyond TechStars, to me, represents a rare triple-win."
49:25 Closing thoughts: "Just do it. Surround yourself with great people. Good things will happen."
VV Show #52 - Sam Wyly of Maverick Capital, Green Mountain Energy, Michaels Stores and Sterling Software
Not to be called a one trick pony, Sam Wyly's turned himself into a billionaire by starting and growing companies in technology, oil, retail and even in the restaurant industry. Coming from a modest upbringing, Sam worked in sales at IBM and Honeywell before founding University Computing in 1963 at age 29 with just "$1,000 and an idea" as he puts it in his book of that title. The company IPOed and grew to over 5,000 people. Sam hired CEOs and stayed an entrepreneur. He's founded and acquired numerous companies including Bonanza Steakhouse (grew to 600 restaurants), Earth Resources Company, Sterling Software (sold for $3.3 billion), Sterling Commerce (sold for $4 billion), arts-and-crafts chain Michaels (sold for $6 billion), Maverick Capital (a hedge fund with over $10 billion under management) and clean-energy producer Green Mountain Energy. Despite being soft-spoken, Sam's fought and won several high profile proxy fights. Sam's been undeterred as several of his ventures have had visible failures over the years and he's lost audacious bids to take over Western Union and Computer Associates. On the whole, Sam's created a huge amount of value that's put him on the Forbes list of the 400 richest people. Hear how he does it.
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3:00 - A modest family background
7:00 - The early years: high school football, Louisiana State Legislature, Louisiana Tech, Ross School of Business at the University of Michigan
14:45 - Computing infancy at IBM: selling "computing as a service"
15:45 - The sales side of IBM
18:15 - Recruited by Honeywell: "I didn't care about the money. I cared about being a manager."
20:15 - University Computing begins: "I wanted to start my own company... I looked around for who could be my customers."
25:00 - Leveraging $1,000 and a 5 year guaranteed contract into a $600,000 used computer
28:20 - University Computing goes public: "The original public investors in four years made one hundred times their money. That was a real fun time."
29:55 - A growing empire: using University Computing interest to buy Bonanza Steakhouse and start Earth Resources, an oil refinery and mining company
31:45 - The steakhouse business
32:40 - Earth Resources: big bet on unleaded gasoline and the battle to sell
37:25 - A rough economy: shutdown of University Computing in 1976
44:40 - Current company: Green Mountain Energy, "It's in the monopoly busting business... It's kind of my third time around in monopoly busting."
46:25 - "Texas was the only state that wrote a really free market electricity deregulation law and we've done real, real well here. It's probably the most successful green company in America."
46:55 - On CleanTech: "It's going to be a great industry."
47:10 - Small company acquires a large one: Sterling Software buys Informatics with the help of Michael Milken and the junk bond market
54:15 - Business partner and brother Charles Wyly: "Mostly we've done everything together."
56:00 - Differences in style: "I've always been the more conceptual type."
58:25 - Business vs. politics as a career
59:15 - Political affiliations and thoughts on Barack Obama
1:02:00 - The modest life of a billionaire
1:03:45 - Advice for entrepreneurs: "Most people have to figure things out for themselves."
VV Show #51 - Jeff Stewart of Mimeo, Monitor110 and Urgent Career
Jeff Stewart needed that done yesterday. Jeff became an entrepreneur when he founded the web consultancy Square Earth in 1995. Only three years later he became a serial entrepreneur by starting Mimeo, a service that lets you send a file directly from your computer to be printed, bound and shipped overnight. Mimeo struggled in the dot com crash of 2000-2001 just as it was getting off the ground. Jeff was able to pull Mimeo though the downturn despite almost running out of cash, which has allowed the company to flourish and make $55.4 million in 2007 revenues. Ironically, Jeff didn't have the same success in good economic times with ample cash after he raised $20 million for Monitor110. He discusses the company's shutdown and lessons learned. Now Jeff's focused on allowing businesses to hire good salespeople faster with Urgent Career. He announces on this show for the first time that he's just raised a six-figure angel round to speed up Urgent Career's success.
1:35 Entrepreneurial beginnings: yard work - "They paid me for it and I was hooked."
2:25 College at Rensselaer Polytechnic Institute, early experience in management consulting, and first exposure to the internet.
5:15 Business ideas for a young internet
7:00 Dealing with misfires and a return to consulting "We had a big competitive advantage: we owned suits."
9:55 "Consulting companies are not particularly good businesses. There's only so many hours in a day and you can only hire so many good people."
11:53 Exiting the consulting business: "I'm a believer that you only get to sell you business once, so you should do it often."
12:14 "You only get to sell your business once, so you should do it often."
13:05 The origins of Mimeo: "It was a bad idea in 1992, but by 1998 it was a great idea."
17:05 Early financials: $20M round of financing, expected to be followed by $300-$400M round in preparation for a $1B+ IPO.
20:05 Keys for success through the downturn: Highly scalable business, a real business problem that needed to be solved, and a huge market
21:45 Reducing headcount
24:20 Raising money in a down market
27:10 "My memory of 2001 was pitching to raise money and firing people."
28:50 The state of Mimeo today
31:20 "Mimeo focuses on career critical documents." "Talking with the customer really differentiates ourselves."
32:45 On leaving Mimeo and finding a new CEO
34:30 "It's a lot easier to start a business if you already have customers."
35:05 The genesis of Monitor110
38:00 Long-term needs of Monitor110: 1) real-time, 2) internet scale, 3) Boolean and Bayesian matching systems, i.e. powerful algorithms
38:40 Halted production on alpha version to focus on beta version: "a major strategic error"
39:40 "Raised close to $20 million... found out it was going to take longer than expected."
42:00 Winding down the company (Jeff's business partner wrote a Monitor110 post mortem)
44:20 Comparing Mimeo and Monitor110
47:10 Lessons learned: 1) "I no longer believe in Hail Mary business models." 2) "Focus on business models that aren't so capital intensive."
50:40 The next idea: Urgent Group, explore business models that are more efficient with our customers time.
52:40 Major problem: "The governing factor for growth is ... how quickly can you scale the sales team... You just couldn't get enough great sales people fast enough."
53:55 "Even at Mimeo... a lot of the venture dollars went to hiring sales people who didn't work out."
54:10 Launched Urgent Career, find and screen sales people using computational linguistics, i.e. figure out the quality of salespeople and the type of sales they are best suited for, focusing on fast growth companies.
57:55 Current state of Urgent Career: ten employees with a six-figure angel round plus personal investment.
59:00 How do you determine how much to raise in an angel round?
1:01:25 Dabbling in GreenTech: "GreenTech will make the telecom bubble and the internet bubble look like a speed bump."
1:04:00 "I believe there are plenty of opportunities in GreenTech that can be done in a capital efficient manner."
1:05:00 What's keeping back GreenTech: "The bottleneck is not enough entrepreneurs digging into this."
VV Show #50 - Derek Sivers of CD Baby and Muckwork
Last time Derek Sivers was on Venture Voice three years ago he told us he had to "whack 'em [investors] off with a stick". Now we know why. Derek announces on our show for the first time the amount he sold his company for this past summer: $22 million. Derek owned 100% of the equity. Though he might have made more money than most of his fellow music entrepreneurs, Derek's no Gordon Gekko. In this interview, Derek tells us how he put all of his money from the sale into a charitable trust, that he didn't even visit CD Baby's office once during the last year he owned it, and what he's up to next.
1:29 Flashback 3 years ago (to his first VV appearance): 50 employees, $25M revenue, no plans to ever sell "till the day I die"
2:00 The CD Baby story
4:13 CD Baby in early 2008, what (or who) had changed / "Hitting the wall"
6:55 January 18th, 2008: The decision to sell, "On my sister's birthday, coincidentally"
9:30 Snapshot of CD Baby early 2008: 85 employees, $100M Revenue, 200,000 albums, but "I hadn't actually been to the office in over a year."
10:10 Living the 4-Hour Work Week in London
Book reference #1 - 4-Hour Work Week by Timothy Ferriss, "He was preaching to the converted."
11:50 "I really started letting go in 2002."
12:00 The perils of owning your own company
14:55 "I've been fascinated by what I did wrong."
15:05 Book reference #2 - What Got You Here Won't Get You There by Marshall Goldsmith & Mark Reiter, "Reading this book it sounds like the guy had been living inside CD Baby, studying me, and wrote a whole book about what not to do."
17:15 Book reference #3 - Execution: The Discipline of Getting Things Done by Larry Bossidy, Ram Charan, & Charles Burck, "Brilliant book about ... how to take things that are goals or things you want to make happen and how to follow through to make sure they happen."
20:20 Book reference #4 - How to Get Rich
by Felix Dennis, "Never, never, never give anyone a piece of your business."
22:30 CD Baby is sold for $22M to Disc Makers
24:17 Book reference #5 - The Paradox of Choice by Barry Schwartz, "I've learned to be a good enough kind of guy"
26:00 The Art of the Deal: "We ended up in the same place later but the bankers were happy."
30:35 Has the money changed your lifestyle?
31:25 The Willy Wonka idea
34:00 The Independent Musician's Charitable Trust: "I didn't even want the money... It's all just going back to the musicians."
36:20 Muckwork and other new projects: "It's all about helping my musician friends... This is what I'd do anyway, even if it pays nothing."
41:10 Muckwork in detail: "An army of assistants that can help musicians do all of the uncreative, boring dirty-work that needs to be done."
44:30 "You don't have to do anything"
46:55 Attention listeners in need of advice: "I'm more available than I used to be so drop me an email."
47:00 "Venture Voice rules... I wonder if I wasn't allowed to tell you some of the stuff I just told you. I guess we'll find out."
VV Show #49 - Rafat Ali of paidContent and contentNext
Attention entrepreneurs dealing with the current economic downturn: This interview is for you. After working as a journalist for Jason Calacanis at Silicon Alley Reporter, Rafat Ali ended up broke in a market with a dearth of employment opportunities. To try to find a new job, Rafat created paidContent.org as an "interactive resume." Luckily, no one hired him. From these humble beginnings, Rafat bootstrapped his blog holding company, ContentNext Media, for four years before taking a small investment from famed media investor Alan Patricof in June 2006. From its inception paidContent has doubled revenues each year and was recently acquired by UK-based Guardian Media Group for a rumored $30 million. Listen in as Rafat outlines the past, present, and future of online media, while sharing his war stories from another uncertain economic time.
1:35 Early career
3:25 Worked for Jason Calacanis
4:48 Working at Inside.com - "Timing was all wrong."
7:50 Learning on the job with paidContent, "I had no idea, zero idea."
8:45 Growing and getting the word out - "It really did spread by word of mouth. There was no other way."
9:20 Launch of mocoNews.net, a sister site covering the mobile space
9:45 June 4th, 2002: The exact genesis of paidContent
10:57 "People thought that you would have to pay to access websites because the online advertising market had crashed."
11:33 paidContent covers "all the ways in which content gets paid for."
11:45 paidContent becomes a full time gig
14:03 Heeding the advice of Seth Godin: "A downturn is the best time to start a company."
14:15 "I actually did e-mail [Seth Godin] a couple of years after that 'you were one of the catalysts that helped me decide'... and he never e-mailed me back. And I'm kind of still angry about that..."
15:05 Early days and a limited budget
15:30 "There were at least two times I remember when my bank [account] had zero balance."
17:23 Advice to entrepreneurs: Get your finances straight
18:53 The blogging lifestyle
19:04 "I had a phone and an internet connection. That's all you really needed in my business."
19:47 Early attention and awards
21:11 Was it fun?
22:04 From a blog to a business
25:10 Early revenues: "high five figures" after 2.5 years
28:20 4 years of bootstrapping: First investment came in June 2006
28:58 On receiving "a few hundred thousand" in financing from media investor Alan Patricof: "his validation was huge for us." They never raised any more money.
30:15 The financing process
32:18 On Alan Patricof: "Immediately I felt like he got (our business)."
33:11 Giving structure to the business
35:32 Post-funding growth: new sites (contentSutra, "covering India's digital content market"), conferences, seminars, research reports, and jobs sections
42:41 Main revenue streams: conferences, advertising, and sponsorships
43:40 Biting the hand that feeds you, i.e. reporting on your own advertisers
46:43 Competition: "It's not a cliche... having competitors in the market helps you define yourself." Note: One of the competitors was co-founded by Kevin Ryan
48:48 On dealing with the rumor mill: "We don't publish rumors."
50:45 "A gossip rag is tough to monetize."
51:23 "You can't define blogging as one industry."
53:22 "We will probably see some more consolidation in the [online media] industry [in the next six to nine months.]"
54:40 Current state of ContentNext: 25-27 people, will add more but being careful, given the current economy
55:40 A "few million" in revenue
55:52 "We've doubled our revenue every year... and are on track to do it this year."
56:17 On the economic slump: "Because we have multiple revenue streams in multiple countries, we will be able to weather [the downturn] a lot better."
57:03 The exit: ContentNext is acquired by Guardian Media Group
60:00 On exit multiples: "Typically some of the big traditional media companies -- and we are not big and we are not traditional -- get anywhere from 3-5x forward looking revenues."
60:51 Keeping the deal quiet: "Tried to keep it quiet... but somebody beat us to it."
64:38 Rafat's advice for media entrepreneurs in the current market
67:10 What's next for paidContent?
VV Show #48 - Frank Addante of The Rubicon Project
Whether working with market trends or against them, Frank Addante has found entrepreneurial success. Before he was 29 years old, one of Frank's companies went public and two were acquired. At his worse, he returned capital to investors. Suffering from serial entrepreneurship, Frank left the Illinois Institute of Technology just four classes shy of his degree. His companies range from an early search engine to a Sequoia Capital-backed enterprise email solution. Now Frank aspires to be a web publisher’s best friend with his new ad network optimization service that he says is boosting their clients' revenues by 30-300%. Listen in as Frank details his ongoing entrepreneurial journey.
1:05 Company #1: Start off with Starting Point – a “card catalog for the internet”
2:20 Decision to leave college and the early days at Starting Point
3:30 Early days of online advertising.
5:11 Life after Starting Point
5:50 Entrepreneurship in Chicago
7:20 Company #2: L90 and Ad Monitor, a focus on advertising technology
8:30 “CEO without the title”
9:15 Comparisons to DoubleClick (Listen to DoubleClick's former CEO on Venture Voice)
10:30 The myth of competing cultures in early advertising
13:25 Surviving a bursting bubble through acquisition
14:34 Thoughts on net-worth volatility
16:03 Leaving L90
- Solving the “what if Frank gets hit by a bus” dilemma
19:25 Company #3: Zondigo
- “The absolute worst time to be starting a company, particularly a wireless company”
- Rare maneuver: returning funding to shareholders
- Avoiding emotional hang-ups of entrepreneurship
23:45 Company #4: Addante & Associates, an incubator, turns into StrongMail Systems
27:00 Moving StrongMail to the Valley and “the Sequoia connection”
32:05 On taking advice and the “not right now” list
34:38 Company #5: The Rubicon Project
- “A combination of great people, funding and [a] market that brought the whole thing together”
38:01 The Rubicon Project in a nutshell
- 80% of advertising is unsold and filled through ad networks.
- Currently 300 ad networks and growing.
- “That’s a lot of chaos.”
- Great for advertisers, a “nightmare for web sites.”
- “Someone has to sit in the middle of all this chaos and that’s what we’re trying to do.”
40:20 The importance of “the team”
41:38 On moving quickly: “Go fast but don’t hurry.”
42:25 Smooth sailing, so far.
- “Customers have seen anywhere from a 30-300% lift in their revenue.”
44:00 On concern from ad networks: “Change will be beneficial for everyone.”
- “33% of consumer time is spent online, but only 7% of advertising budgets.”
- “It’s still too damn hard to advertise on the internet.”
- “We’re just trying to automate this.”
- No channel conflict: “Will not sell direct to advertisers.”
47:00 Stats: 60 top ad network, over 4,000 publishers, 40 employees, $21 million raised
47:20 Thoughts on the future of The Rubicon Project
48:35 Advice for entrepreneurs
- “Mistakes are OK”
- “Try not to be a feature”
- “Build a great team”
- “Figure out your business model early”
- “Just go for it”
Frank's Blog: FounderBlog
Frank's pitch for LA:
VV Show #47 - Tom Perkins of Kleiner Perkins
The name Tom Perkins is now almost synonymous with venture capital, but it's clear that he cut his teeth as an entrepreneur. Educated at MIT and Harvard, Perkins first made his mark by managing the initial growth of Hewlett-Packard’s computer business while simultaneously inventing the first cheap and reliable laser. The company he built around the laser, University Laboratories, made him independently wealthy and allowed for the creation of Kleiner Perkins, one of the most successful venture capital firms in existence. Kleiner Perkins (now Kleiner Perkins Caufield & Byers) has funded a wide range of well known and wildly successful companies including Google, AOL, Genentech, Sun Microsystems, Compaq, and Tandem Computers. Though Tom's wowed the business press for much of his career, later in life he's gained national attention for having a key role in 2006 Hewlett-Packard board controversy, briefly marrying Danielle Steel, and building the world's largest privately owned sailing yacht. Tom has recently stepped back into the media spotlight by publishing a memoir called Valley Boy: The Education of Tom Perkins. Listen in as he discusses his journey from New York to Boston to Silicon Valley, the creation of Kleiner Perkins, and his advice for the entrepreneurs of the future.
3:00 Early ambitions: the road to MIT.
4:40 From Theoretical Physics to the Harvard Business School.
6:15 Introduced to the Hewlett- Packard company: “a great stroke of luck.”
6:52 “Dave Packard taught me everything I ever learned about entrepreneurship.”
8:42 Simultaneously running HP’s computer business and University Laboratories.
11:15 Thoughts on moonlighting and Google’s 20% time.
12:23 Why not jump ship with University Laboratories? “It was a very tough decision [but] I was so fascinated by the computer business, which was growing explosively.”
13:40 Dave Packard: the first modern VC.
14:30 The Kleiner Perkins model: A “hands on” approach to VC.
15:00 First KP fund: $8 million, largest ever at the time.
15:25 The admirable ethics of venture capital.
19:00 Early KP hits: Tandem Computers & Genentech.
20:15 “Our philosophy was that you find the idea and not the individual.”
22:39 “We’ve never financed anything that’s come to us through the mail or over the Internet.”
23:40 The “Intensive Care Unit” at KP.
26:30 Biggest mistake: “Not funding Apple Computer."
29:02 Thoughts on the modern day venture capital industry: “There’s always been too much money in venture capital.”
31:15 Thoughts on entrepreneurship and venture capital outside of Silicon Valley: “It’s a difference of psychology.”
34:40 Valley Boy, the Tom Perkins memoir.
36:40 Working on the News Corp. board.
41:30 On his own depiction in the media: “A venture capitalist should be behind the scenes… I yield the arena of self-promotion to no one, although Paris Hilton is gaining ground there.”
43:00 Current activities: sailing and submarining.
44:30 Recent comments on the science of global warming.
44:54 Biotechnology: “I still think we’re on the ground floor.”
46:00 Advice for new entrepreneurs.
VV Show #46 - Jeremy Stoppelman of Yelp
Jeremy Stoppelman is the co-founder and CEO of Yelp, a site where users can write and share reviews of local businesses. Everyone's now a restaurant critic. However, local reviews were not the original focus, but just one of several features in the earlier versions of the site. Noticing the growth of this buried feature, Yelp re-tooled the site around reviews and hasn't looked back since. Does this story sound familiar? Jeremy's the former VP of Engineering at PayPal, which also had to drastically alter its business early in its life. Listen in to hear Jeremy's thoughts on growing a local enterprise, giving users and identity, and how to recognize and act upon the need for change.
1:45 Early Internet experience
- Joined PayPal at 22
3:10 Uniqueness of Paypal
- Always knew they were "doing something of value"
- Macro environment was the problem: surviving the bust
- IPOed when IPO's were not happening
- "The elephant in the room was how do we charge"
6:00 Switch to business school, but why?
- Interest in business strategy
- Wanted to start a company, but didn't feel he had the full toolbox
7:05 What was the value of B-school?
- Case studies, referenced to this day
- Yet, only stayed for 1 year
9:30 Yelp is born
- Fascinated with the local space
- Local hadn't happened yet on the Internet
- Yelp catalyst:sick and looking for a doctor, no good method to gage reputation
- "Word of mouth amplified"
11:06 Yelp, an evolution not a revolution
- Original idea: "It's the same concept, broadly, but we had a different focus"
- Find out who your friends use, if no responses, then reach out to a broader audience
- Reviews were an afterthought, "buried in the site"
- Looking at the site usage, some people jumped on the reviews
13:25 Earlier on, what did the company look like?
- Expected a long road, "sipping the cash"
15:25 How did you know when it was right to change the strategy?
- Passion for the problem
- Data tells the story
18:50 Please yourself
- "I built a site that worked for myself, and that translated well to other people"
- Used personal impressions from use to develop new features
19:30 Catering to a female audience
- Found that females were responding well to the site
- Altered the color scheme
- Softened the word Yelp with visual elements
- Effects were immediate
22:15 Strategy discussions
- Paid reviews? Only in the early stages of a city.
- Broad or focused?
25:12 Citysearch differentiators?
- Citysearch = editorial, Yelp = reviews
- Citysearch users are semi-anonymous, Yelp users have a profile and identity
26:40 How do you make it popular?
- Get it right, and people will spread it.
30:10 Yelp gets Googled
- Adapted overtime to search engine
- Early 2005, site was not crawler friendly
- Fixed search engine optimization, still paying off today
32:50 Expansion beyond the Bay
- Use Craigslist and other examples to locate ideal cities for local services
- Require cities and population that are "properly wired"
- Employs representatives in each major city
- Local reps and marketing staff seed the content
- But Yelp has a unique spin
37:18 Revenue model
- Sponsorship program provides an upgraded page for a business
- No editorial content (a la Citysearch)
38:42 Is Yelp a tough sell?
- Yelp users and business customers make the introduction by going to places they discover on Yelp
- Word of mouth makes it to the owners ears
- Existing positive reviews motivate owners to join
40:07 How do you scale a local business?
- "The short answer is we don't quite know"
- But building a sales force
- Small businesses don't spend a lot of time looking at innovative ways to market themselves
- They need to be reached out to
- Employing VC dollars to build the sales force
41:01 Current state of Yelp
- Raised $16 Million
- Just over 50 people
- "Growing as fast as we can manage"
- "Revenue's great"
- VC backed so not profitable, but a lot of potential in the model
43:20 Biggest challenges?
- "Not screwing it up"
- Hiring the right people
- Not moving too fast
- Most important: taking care of the community
45:45 Any desire to grow faster to secure a large buyout?
- Not really
- Always external noise, learned to ignore it a PayPal and focus on the product
- "We're one of the rare start-ups that actually does have a pretty crystal clear picture of what our total business looks like"
47:10 Words of wisdom
- "Be prepared for the ups and downs"
- Volatility goes down after time, and it's very rewarding past the hump
VV Show #45 - Kevin Ryan of Panther Express, ShopWiki and Music Nation
Not many entrepreneurs have a motor like Kevin Ryan's. Kevin is best known for his work as CEO at the on-line advertising firm DoubleClick, which he grew from a 20 person start-up to the largest Internet company in New York at the height of the dot-com boom. After escaping the ensuing bust in an arguably improved strategic position, the company has since changed hands twice. In June 2005, the company was sold to the private equity firm of Hellman and Friedman for $1.1 billion and has made headlines yet again with its recent acquisition by Google for an astonishing $3.1 billion. Yet, this success has not slowed Kevin one bit. Since departing DoubleClick, he has already launched three start-ups, with plans for a fourth this summer. Listen in, as Kevin describes his DoubleClick experiences in both boom and bust, outlines his new start-ups, and explains why now is as good a time as ever to start a company, especially in the Big Apple.
2:00 Early career
- INSEAD by way of Wall St.
- EuroDisney: “an incredibly unpleasant experience.”
- United Media: launched Dilbert.com, which he describes as a “fantastic experience.”
3:55 The Internet according to Dilbert
- “[P]eople were passionate about the Internet and no one who started using the Internet stopped using it.”
- “[The Internet] is most fundamental business shift that is going to occur in my lifetime and it’s going to reverberate through almost everything.”
4:43 Focus on advertising
- “Advertising was going to be a key part of the Internet infrastructure… and the infrastructure didn’t really exist at that point to do it effectively.”
- Joined a small startup called DoubleClick because of their “valuable position.”
6:10 What differentiated DoubleClick?
- “People and technology at DoubleClick were really going to make it the long-term leader.”
- “They were thinking very big. The plan was that this was going to be a billion dollar company some day.”
- “Technology was going to play a huge role. That you could dynamically target these ads… that would make it ultimately much more effective than other medium.”
8:10 The DoubleClick alumni club
- “There are so many companies run by double click alumni.”
- “I will feel great in ten years if there are 10 people in this room who are CEOs. And it’s turning out to be the case.”
8:42 Lessons learned as CEO
- “The key was managing the growth … Force everyone to continue delegating”
- “[Y]ou’ve got to be able to make changes and make them relatively quickly.”
10:42 Dealing with mistakes
- “As long as you self correct … you can recover just fine”
12:38 Money management
- “We definitely spent too much money… It felt like capital was free.”
- “Today, that I’m launching companies and I see other people launching companies, everyone is more careful and more thoughtful and more cautious.”
13:09 The IPO
- “At that time the IPO process went incredibly well and it was easy because investors didn’t know what they were investing in.”
- “We were the largest [Internet] company in New York City. So it was just a great time.”
14:03 The boom goes bust
- “I can remember one week in the beginning of 2000 when the stock price, the value of our company went up by a billion dollars and I thought ‘this has got to be the beginning of the end here.’”
- “We had 70% of our clients who went under. You were prepared for 10%. You were prepared for 20%. I don’t think anyone prepares you for 70%.”
15:30 Lay-offs began and continued
- “People had lost faith in management.”
- “That’s the hardest thing to do. Senior management has to always feel positive and be positive about the future and it’s hard to do in a terrible recession.”
- “I never came close to quitting. I always knew the fundamentals of the Internet were going to win out.”
17:57 A changing business model
- “[We] always made more money in the technology business than the media business.”
- “Over time, [it] started to feel like we were having some conflicts. Some of the larger players didn’t want to deal with us on the technology side because they thought we were selling ads and competing against them.”
- “Getting out of the media business was the right decision.”
19:10 Exit strategies
- Hellman & Friedman buys DoubleClick for $1.1 billion in July 2005.
- Google buys DoubleClick two years later for $3.1 billion.
- “Three years from now, Google will look back and think that it was a good purchase."
20:00 New ventures
- “Really wanted to get back and felt there were opportunities in smaller companies.”
- “I felt like it was a fantastic time in the Internet…Unlimited capital available… The fundamentals of advertising, commerce and subscriptions, which are the three elements of the ecosystem, are all doing great.”
25:05 Start-up #1: Panther Express
- Content delivery network.
- “[A] sector that’s going to cross over $1 billion in revenue.”
- CDN’s are not a commodity; there is segmentation in the market.
- “We felt there was an opportunity for a very low cost infrastructure.”
- “Business is going to grow about 10 times from January to December.”
28:48 Keeping it lean: the benefits of a small office
32:30 Start-up #2: ShopWiki
- “We felt, as consumers, that there was a real need for an independent, consumer oriented shopping engine, a search engine for shopping.”
- Traditional shopping sites are not searching the whole Internet; “they’re just taking ads.”
- Most shopping sites search 6,000-7,000 websites; ShopWiki searches 180,000.
35:15 Time: the most limited resource
- “Prioritizing time is an inexact science but it’s very, very important.”
- “At the beginning of the week, I always list the three most important things and make sure that I spent enough time on those three things.”
36:40 Start-up #3: Music Nation
- YouTube meets American Idol.
- “Blown away by the traffic.”
- “Goal is not to have as many videos as YouTube. It’s to have fewer videos of higher quality.”
39:55 Best entrepreneurial locations
- Community is bigger in the Valley, but New York is closer to your customer base.
- “New York is the clear second to Silicon Valley”
42:17 Current health of the start-up market
- “I’m incredibly bullish.”
- “I think we’ve got another good five years of very significant growth.”
46:04 Start-up #4!
- “I’m going to launch another one this year in the e-commerce space.”
- “It’s in the women’s fashion space, in clothing, but you’ll see it’s a different twist on the business model.”
46:35 Advice to entrepreneurs
- “Don’t be afraid to take risks. Especially in the US economy, you’re not penalized.”
VV Show #44 - Venture Voice Startup Workshop Coverage (part 2)
Marketing a startup is tricky business. Every entrepreneur faces the dilemma between allocating time to improving the product and marketing the product. If the two can be mixed just right, then perhaps sterile marketing can go viral. We tackle that issue in part 2 of 3 of our very own Venture Voice Startup Workshop coverage in New York City. David Hornik of August Capital leads the session, but he doesn’t finish uninterrupted as the entrepreneurs on the panel jump in.
4:30 Marketing, sales and PR
- According to Wikipedia, “Marketing is ‘human activity directed at satisfying needs and wants through exchange processes.’ I’m fairly certain that’s prostitution.”
- “All this stuff is about sales, PR and marketing, if you could avoid it altogether and just get the sales that would be great.”
12:30 Viral marketing
- “If marketing cost money, then viral marketing is free.”
- A virus “can’t be lethal because if you spread the virus and it kills you, you can’t spread it anymore. That’s just bad news… It has to be really fun. This is why venereal diseases are awesome.”
- “A venereal disease in a really attractive stewardess is a lot more valuable than a venereal disease in, say, me.”
- “Measure things.”
25:15 Best practice
- “The best bang for the buck is having a great product that’s highly viral and highly measurable, but if all else fails you can always sell crack.”
VV Show #43 - Fred Seibert of Frederator Studios and Next New Networks
Before the rise of the Internet, cable TV was the new form of distribution remaking the entertainment business. Life-long entrepreneur and former jazz producer Fred Seibert pioneered that field, and is known in the industry for branding MTV (remember their ever-changing animated logo) and Nickelodeon (remember Nick-at-Nite). While he was figuring out what to do next, Ted Turner hired him to be president of the then-struggling Hanna-Barbera cartoon studio. Fred turned the famous studio around and kept his hand in the cable business until some friends dragged him into the Internet business. He now runs Frederator Studios which produces several cable and Internet TV shows. He also just launched a new well-funded startup called Next New Networks to create Internet TV networks.
1:30 Getting started as an entrepreneur
- Parents were “mom and pop business people,” they owned a pharmacy on Long Island.
- Started a jazz label with a friend at age 19.
- “I’ve never looked for a job.”
5:10 Criteria for selecting a business idea
- “I don’t have any criteria.”
6:30 Getting into the cartoon business
- Became a cable television exec in 1980 after being hired by Bob Pittman for a corporate startup that became MTV.
- “I’m less an executer than I am an analyst of things.”
- “I was a real dark horse candidate” for becoming president of Hanna-Barbera.
12:45 Creative types verses suits
- Hired the now-MTV Networks Chairman and CEO Judy McGrath as a promo copywriter in 1981.
- “I don’t know that I’m either.”
17:15 Fixing Hanna-Barbera
- “Hanna-Barbera had not had a hit since 1983 with the Smurfs.”
- “I took over Bill Hanna’s office.”
- “I was so scared.”
- On his first meeting with Ted Turner: “I talked with the guy for 15 minutes. In 10 minutes he was complementing my belt.”
- Producer role model: Fred Quimby.
34:00 The Internet
- “I had no particular interest in the Internet.”
- Ran MTV Networks online division but quickly left after lack of support from management.
- “We are the only major animation producer in the world that keep an active blog.”
- Launched online video shows Channel Frederator and VODCars to great success.
- Included Herb Scannell and Dennis Miller (not the comedian) in the discussion.
- “We like dependability, not predictability.”
- “Digital right management is for the birds.”
55:45 Starting Frederator
- Called “best favorite video friend” Jakob Lodwick of College Humor and was introduced to first employee Justin.
- “It’s less about getting good content than understanding the marketplace.”
61:00 The value of Next New Networks
- “I learned a long time ago that when I laugh out loud, I got to find the guy that did it.”
- Business is right for working with someone like Dan Meth but maybe not Andrew Baron of Rocketboom.
- “What our venture is about is creating structure where anything is possible.”
67:00 Bad blog reception
- Snarky posts on Next New Networks: VentureBeat, GigaOM and PaidContent.
- Characterizing the blogs' reaction to his company: “Here’s some fat old guys.”
- “We’re out of the club.”
- “The two most important partners are 30 years old.”
- “If you saw the nasty things people wrote about us when we were doing MTV…”
73:30 Starting a company
- “Starting a company is always the same.”
- On starting businesses: “I think I’ll do that until I drop.”
- “I don’t think there’s any confusion or adversity unless you’re confused and adverse.”
- Quotes and recommends Adventures in the Screen Trade by William Goldman: “In Hollywood, nobody knows anything.”
Fred’s book: Original Cartoons: The Frederator Studio Postcards
VV Show #42 - Simon Daniel of USBcell
The battery is an afterthought for most inventors. All the fun seems to be in developing a device, not in powering it. But when was the last time you cursed your phone, camera or podcast player because it ran out of batteries? Simon Daniel got fed up with his batteries, and decided to do something about it. He invented the USBcell, a standard sized battery (yes, it comes in AA) that can recharge using any USB port. This isn’t his first invention. Previously, he invented the folding keyboard and licensed the technology. This time he’s bringing the USBcell to market himself through the company he founded called Moixa (axiom spelled backwards). Though this might force you to think differently, don’t worry, we won’t play the podcast backwards.
1:00 Working at IBM’s scientific center at Winchester between before college
3:15 Went to Christ College at Cambridge University
- Same year as Sasha Baron Cohen
5:15 Worked at Anderson Consulting (now Accenture)
10:00 Jumping ship to start a new venture and modern art
- Came up with folding keyboard in mid-1990’s
- Licensed to Think Outside
13:45 Taking action on an invention
- “We tend to file a patent on the way to make something rather than the generic idea of something.”
- “If you just write down the idea itself and don’t do the work, then the patents you get from just doing that stage aren’t that useful.”
18:00 Being too early to market
- “It’s like having a very good joke which is really funny in two years time when there’s a political situation which is right for it.”
21:00 The company
- “The word Moixa is the word axiom backwards.”
- “Rethinking a fundamental assumption.”
24:00 Financing strategies
- “Ideas should wash their own face pretty quickly.”
- On traditional battery chargers: “It’s somewhere you’re not.”
- “It’s that kind of constrained environment that sometime you get an instant solution…”
- “There was no way we could create a budget to outspend the traditional battery companies.”
46:30 Entrepreneurship in the UK
49:15 Goals for 2007
51:15 Capitalizing on invention
- “Timing is a thing you have to get right.”
- “The value of the innovator keeping away is fundamental.”
VV Show #41 - Premal Shah of Kiva
Premal Shah believes your last name doesn't need to be Gates or Rockefeller in order to make a real dent in global poverty. After leaving his job as a Principal Product Manager at PayPal, it has taken Premal less then a year to make good on Kiva's pledge that all it takes to become a micro lender is a credit card and access to a computer. Raising money "Howard Dean Style" from over 13,000 online lenders, Kiva has provided more than a million dollars in low-cost working capital to small-scale entrepreneurs in less developed countries from Bulgaria to Uganda. The site boasts high repayments rates and soon hopes to offer lenders interest. We talk to Premal about how working in Silicon Valley has shaped his approach to combating poverty, how he believes the market "bakes in psychic and emotional returns," and how the power of online communities can strengthen the world of micro credit.
Episode producer: Koshlan Mayer-Blackwell
1:35 The pitch: why micro-lend?
- "[Imagine] a woman in Kenya who has a small piece of land. If she had eighty dollars for an irrigation pump she could actually get more productivity out of the land and increase her income from maybe $120 to $1200 a year."
- "She can't go to a bank…she is asking for such a small amount of money that it is not really profitable for a bank to serve her. "
- "And [micro lending] is not a donation or a handout, because the repayment rates are 95 percent plus."
3:15 When PayPal was no big deal
- "I left management consulting in New York and came out to a small company called PayPal in Silicon Valley"
- "At the time it was very small and people, by and large, still thought it was a joke of a company ("what do you mean I am going to email money to friends?")"
4:10 When "the ship" gets too big, just get back to entrepreneurship.
- "What would the intersection of the things I know and love look like? PayPal, eBay, micro finance. What would it look like if they were all blended together? And that's where Kiva.org came into play."
8:44 Entrepreneur lesson
- "I think one big lesson in entrepreneurship is that you just have to get started. Get a product out there and see how the world reacts."
- "The biggest danger is spending a lot of time doing a lot of analysis and PowerPoint: lining up all the duck before you even get started."
10:00 Repayment: No Problem
- "The women actually monitor each other and the repayments, and if one of the women defaults on the loan, they will all be penalized by not being able to receive more loans in the future."
- "And this reputational collateral and peer monitoring helps keep the repayment rate at 95 percent plus, which is better than credit card portfolios in the U.S. "
10:55 "Howard Dean Style"
- "The average loan size is $73, so it is very Howard Dean style. What I think is interesting is that no one user contributes more than 1 or 2 percent of our total loans raised."
- "We believe in grassroots capitalism. How do we get the masses to participate in poverty alleviation, based on mutual dignity with the business that they have sponsored?"
- "…our goal is to sign up as many users as possible, getting them to donate 25 dollars at a time and learn that the working poor are actually good credit risks."
12:40 A Favorite Loan
- "Essentially we aggregate funds from across the internet…we pass 100 percent of the loaned funds to intermediary microfinance institutions that are out in the field (say in Kenya, Uganda, Honduras, Senegal)"
- "What is exciting about Kiva is that it makes the lives of entrepreneurs transparent."
- "A guy in Bulgaria who started a bike shop. He got a $500 loan to start, and to promote his bike shop he started these bike racing competitions."
15:30 Zero percent Interest Rate: that does not sound like a good business to be in?
- "So we are a non-profit and today we are offering zero percent, but what we would like to do is to let interest rates float on the website."
- "I think it would be exciting to let people earn a rate of return where they were financially indifferent between Kiva where they are changing somebody's life, and their bank account (on a risk adjusted basis). I think that is possible."
18:40 User-Generated Metrics
- "We think for the first time in history, we will actually be able, through the wisdom of the crowds, to rate each microfinance institutions and the transparency on the site."
- "We will actually be able to bake into the financial price the social value creation."
- "Through letting the community rate the Internet community rate each loan, just the way you can rate a video on
- YouTube or a photo on Flickr, we think we can create a quantitative metric on social value."
- "The lender can weigh the metric on social value as well as the financial return as well as the repayment likelihood and those three variable will help us to create a market where capital can get to the best lending institutions…"
19:35 Transparency is Key
- "If you can be transparent about how the money is being used, be it through MySpace-type profiles, it can motivate a lot of people to participate."
- "People want to change the world they just want to know that it is done effectively."
20:20 Can a picture tell a thousand lies?
- Greg: "In the book Blink, Malcolm Gladwell cited a story about why there were no women on the New York Philharmonic. People had all these theories that women didn't have the same hearing or weren’t wired just right. Then, unrelated they put screens between the performer and the people listening to the recitals, and all of a sudden, women started to get onto the Philharmonic …do you worry that photos will get to people's prejudices and not lead to as an efficient of a lending market if you focused the information on more hard numbers?"
- "And if they weigh not only financial return and social impact, but also emotional and psychic return, that should be baked into the price."
- "A Kenyan is ten times more likely to be funded then a Bulgarian. A Kenyan is 4.6 times more likely than a Cambodian."
- "I think that is just fine. The goal is to make it as transparent as possible and see where the capital shakes out."
- "Kiva understands that [corruption] is a fact of life, and our goal is to create as transparent of a platform as possible."
- "Creating an online platform where people an actually blog about [failures] to achieve a level of trust... that's critical."
- "Loans are an information exchange, as opposed to donations, meaning when you loan your money and you get your money back, you know that something has happened. You know that there is some progress being made that has allowed for that entrepreneur to repay."
- "The accountability on each dollar that is donated versus the accountability on each dollar lent. There are just two different stories there."
VV Show #40 - Reid Hoffman of LinkedIn
Real business networking takes place in the country club, at the chamber of commerce and on the golf course. After all, the Internet is just for friending strangers on MySpace and poking friends on Facebook. If you said all that to Reid Hoffman, he might think twice about adding you as a contact in LinkedIn, the business networking site he started that connects over seven million professionals. Although his Palo Alto-based company is now profitable and growing rapidly, Reid still thinks he has yet to hit the tipping point. Reid’s goal wasn’t always to be an entrepreneur: He just wanted to change the world. His original career choice was “public intellectual”. Hear if his career switch is paying off.
1:00 Surprising beginnings
- "When I graduated from Stanford what I wanted to do was be a public intellectual, and at the time I thought it was someone who writes essays for the 'New York Review' or 'The Atlantic Monthly'"
2:00 Advancing career
- "And what I realized was if you actually look at software and online services as media objects that could do this, you could go create really valuable media objects that would have a much deeper transformative effect on society..."
- "So I went and talked to a few VC's in the fall of '93 when I first came back [from school at Oxford] and they said
- 'Go get a job and then when you've learned some things come back and talk to us.'"
- "So I went to Apple computer"
- "And did my first startup, Socialnet, in 1997"
6:00 On financing a start-up
- "Basically if you can't get enough capital to get your business off the ground, and usually it's a successive set of influxes of capital, your business fails, and it goes away"
- "Venture investment is like marriage, on two power point presentations and a dinner"
8:00 Paypal, lessons learned
- "There was a time at Paypal where we were growing at five percent of transactions per day, and we had three customer service people"
- "We were going in the hole about 8000 e-mails a day in terms of e-mails we weren't responding to."
- "We had people find out the address, and drive to our office in as far away as Arizona...to deal with customer service."
14:00 On LinkedIn
- "Part of the theme of the internet is essentially power to the people."
- "Enabling individuals to have the best possible lives they can is one of the things that's really interesting with the net"
- "And LinkedIn, it's every person as a professional can hang a shingle to the web and they can say what kind of business they're interested in doing and then they can find other professionals either that they already know or they wanna get to know in order to connect with them and build business."
18:00 Business model advice
- "One of the things that I tell entrepreneurs and investors, especially if you're in consumer internet, is I have yet to see a series A business model be the business model at the end of the company"
20:00 Target market
- "Our principal customer base is kinda like 27, 28, plus"
- "So unlike for example Myspace, or Facebook or Friendster which is 'Wow! A place to play with my friends and I have lots and lots of spare time...' its a 'Prove to me you're valuable.'"
27:00 Delivering value
- "If you go up to your average professional on the street right now and you say 'Well you should have a profile out on the web, stating who you are and what kind of things you do,' most professionals are gonna look at you like, 'Huh, really?' Like it hadn't really occurred to them."
- "People care a lot more about their professional contacts than they do about their social contacts"
"Take the word networking. To most people, networking is a vaguely negative cause it connotes people who say
- 'Can I have your business card? Can you help me?' As opposed to 'Can we help each other?'"
36:00 How LinkedIn works
- "What reference is supposed to be is I refer you to someone based on what I know about you, on my ability to say 'Oh he's a good person, he's hard working, he's trustworthy, he's honorable, he's diligent, he's a close friend of mine, do me a favor...'"
- "Better people should be able to create shinier shingles"
- "The people that you think are smart and interesting, there's a much higher percentage of the people that they're hanging with are smart and interesting. So, same principal on LinkedIn."
41:00 Web 2.0
- "Launching something is a lot cheaper than it used to be"
- "But, on the other hand there's lots more interest."
- "Actually if you have a thousand people going out launching shit, for 100k or 200k, the one that can raise 5 million and deploy that effectively has a huge competitive advantage."
43:00 Advice to entrepreneurs
- "Entrepreneurs: it's never a sit in a room and create something by yourself, you're out there in the flow"
- "Your idea isn't anything until it starts going, right? Ideas are great -- but traction, reality, launch something, get customers. So LinkedIn is useful for finding all the right people that will support your effort."
- "In Silicon Valley, my guess is 95% plus of the people who are pitching venture people are in LinkedIn."
Thanks to Jason Brady of Play Entourage for helping me find this file after it went missing for over a year.
VV Show #38 - Jason Calacanis of Weblogs Inc., Netscape and AOL
There are not many entrepreneurs who have spent their entire 10-year careers starting new ventures in online media, but Jason Calacanis just can’t help himself. Jason rode the dot com wave in New York by starting Silicon Alley Reporter. His publishing company Rising Tide Media grew to $12 million in sales. Unfortunately Jason also rode that wave down after the bubble burst. He ended up selling his first business to Dow Jones for a lot less money than he could have gotten before the crash. Undeterred, Jason started Weblogs, Inc. to make money by selling ads in blogs they pay people to write. In only 18 months he grew the business to a point at which AOL (TWX) bought it for a reported $25 million. Now he’s re-launched Netscape as a news website where users vote for what’s important. Jason’s caused a lot of controversy by paying top users of competitive sites such as Digg (whose CEO Jay Adelson was on our last show) to switch to use his service. Hear what’s been driving Jason’s entrepreneurial career.
2:00 First company: Rising Tide Media
- “It became a $12 million a year business.”
- “You don’t sleep so well those first couple of night when you’ve got two grand on your credit card and you got to pay it back in a month and you have AMEX calling every week.”
- “I was in the right place at the right time.”
- “A big part of success is not just execution but picking what beach to go surfing on.”
- “When you’re in an up market everyone looks like a genius.”
7:00 Personal style
- “I’ve been given this whole persona of being bombastic.”
- “You have to detach yourself from the things are you create as an entrepreneur.”
- “I think being delusional and stubborn is a really great quality for an entrepreneur.”
16:00 Starting Weblogs Inc.
20:30 East Coast vs. West Coast entrepreneurship
- “I’ve never been really a ‘valley guy.’”
28:30 Building an ad sales force
- Pays ad salespeople only with commission.
34:00 Re-launching Netscape
- “We didn’t launch it to compete with Digg.”
- “If we kill Digg or beat Digg, that would be failure for us.”
- “We were on our way to building a social book marking site. We weren’t going to call it Netscape, we were going to call it something else.”
- “Anyone can make a Digg clone in a weekend.”
- “It was always in the plan to hire bookmarkers.”
43:15 Doing business in social media
- “I e-mailed Jay about it and I said ‘Jay, please don’t call me a thief when you in fact were inspired for your site by [del.icio.us].’ He actually wrote me back a nice note and said we’ll tone it down.”
45:00 Should users get paid?
- “I’m going to cost people money with this idea” to pay users.
50:45 Dialog with Digg
52:00 Social news industry
55:15 Working for AOL
- “I don’t really answer to anybody at AOL.”
Photo credit: JD Lasica
VV Show #37 - Jay Adelson of Digg
Digg, the news website that uses its own readers rather than editors to decide what stories are most important, has been growing with a fury. While founder Kevin Rose has gotten a lot of attention including a recent cover of BusinessWeek, CEO Jay Adelson has been guiding Digg toward business success. This isn’t Jay’s first time though the throes of entrepreneurship. He started Equinix, a company that now has a market capitalization of $1.5 billion. Despite its success, Jay didn’t make much money because he held his shares until after the dot com bust. In fact, he had just enough money to put his kids through college and live a more modest lifestyle himself. He was ready to go off and work at a coffee shop or become a teacher until Digg came along. Now he’s back in the game.
2:00 Early career
- “I was focusing on sound engineering. I thought I would do that for the rest of my life.”
5:00 Entrance into entrepreneurship
7:15 Co-founding Equinix
- “I over delegated.”
- “I wanted people with experience doing very big things.”
- “I wanted [Equinix] to be a billion dollar company, sure, but I think I wanted it to be something that was a little less commodity focused.”
- “I’m extremely proud of what happened with that company.”
- “I’m never satisfied with myself.”
19:00 Between ventures
- “I drive an eight year old car. Never got the sports car or Ferrari.”
- “Unless you’re truly incompetent, it’s really hard to set yourself up so that you’ll never get investment capital again.”
- “There are a lot of people who confuse good ideas and good businesses.”
24:00 Quitting entrepreneurship
- “I could get by at this point with a much lower class lifestyle. We made the decision to leave
- San Francisco and move to rural New York.”
- “I just kept trying to help him [Kevin Rose] change what was a good idea into a good business.”
28:00 Starting Digg
- “One thing was clear from our perspective: We couldn’t charge users. That would never fly.”
- “It wasn’t too hard for him [Kevin Rose] to convince me to come on as CEO [for Digg].”
- “Kevin was never satisfied with the specification.”
- Digg went live in December 2004.
- “Probably less than $5,000 had been spent before the site was public.”
- “If I don’t handle the growth, then I’ll implode.”
- “He [Kevin Rose] literally is the chief architect of Digg.”
41:30 Virtual business
- Uses http://www.apple.com/isight/ iSight frequently to run Digg.
43:30 Worst business decision at Digg
45:30 Business model
47:00 Biggest competitor
- “My biggest competitor is probably someone I haven’t met yet.”
- Competitors: Reddit, Newsvine and Netscape
- “They [Jason Calacanis's Netscape] even copied the look and feel.”
- “I don’t believe that we should be compensating any Digg user for their participation.”
60:00 BusinessWeek cover
- “Kevin Rose did not make $60 million. He did not have that cash. That was completely invented.”
62:00 Business capitalization
- “I’m not feeling the pressure [to raise a lot of money].”
- “What happened to the days when I could just focus on building the business?”
- “At Equinix I never sold my stock, and oops. Oh well.”
68:30 The future of Digg
- “The best I can tell you is Digg as a concept can be applied to other content aside from news. Just wait and see what we’re going to apply it to.”
- Closing on funding round for Revision3.
VV Show #36 - Venture Voice Startup Workshop Coverage (part 1)
If there are best practices in entrepreneurship, you’ll hear the secrets to them in this coverage of the first half of the recent Venture Voice Startup Workshop in New York City. If there are in fact no best practices for entrepreneurs, then you’ll at least enjoy the heated discussion about how entrepreneurs should navigate the startup seas. These passionate speakers fielded a day’s worth of questions and opinions from Venture Voice, each other and the spirited audience. The results are distilled ideas about what it takes to win in business, great war stories and even a few laughs.
3:00 Topic: Partnerships
- Jeanne Sullivan: “I’ve had an e-mail address since 1980.”
- David Hornik: “I hate my partners.”
- JS: “I believe the CEO is the most important person on the team.”
- Dick Costolo: “A lot of people refer to these ‘Barney partnerships’, where you just agree to like each other, write each other down as partners, and hug.”
- Scott Heiferman: “One general rule is to not have rules.”
- SH: “Don’t necessarily listen to panels like this if they give you a general rule.”
- DH: “Never do deals that your venture capitalists tell you to do.”
- DC: “Google could build a space station if they wanted to. Of course they could build FeedBurner.”
20:20 Topic: Getting and keeping customers and users
- SH: “If there’s one message to get across to help you focus your thinking and what it is you’re doing, it is the basic understanding that people are confused.”
- SH: “People are not waking up in the morning and saying ‘I want to generate content today.’”
29:45 Topic: Building a team
- DC: “You can’t have a big circle at the top with three randomly floating folks unless you’re Google.”
- DC: “Sell the hardship… If you’re working for a startup: Sucky hours, low pay, with potentially no benefit.”
- DC: “You pay ten times over for bad hires.”
- JS: “I’ve become really good at firing.”
- DC: “Having the open space is great for team building.”
Hear from the rest of the speakers in part 2 of this series, coming soon.
View photos from the event.
VV Show #35 - Sharelle Klaus of Dry Soda
While many restaurants offer dozens of wines, beers and mixed drinks, there are few non-alcoholic options on the menu. Former dot-com entrepreneur and self-described foodie Sharelle Klaus was fed up with her lack of beverage options during the time she was pregnant with her four children. She decided to create the first line of “culinary sodas,” which are less sweet and more sophisticated than sodas like Coke or Pepsi. Based in Seattle, Sharelle’s now peddling her soda all across the country and already has traction in several markets.
1:45 Entrepreneurial streak as a child
- “My dream was to get into politics.”
- “It was going to be too slow.”
3:45 Consulted on privatizing airports
- “It didn’t really take.”
5:15 Had two children
5:30 Getting into the internet business
- “At that time the Internet didn’t have much, I remember it was like Yahoo and porno sites.”
- Founded PlanetSquid in 1999.
- “The bubble burst, and do did ours.”
- “I knew that I would never, ever, start a company again that didn’t have a clear revenue stream.”
8:30 After the bubble
- Became president of the Forum for Women Entrepreneurs.
11:15 Going into the beverage industry
- “I was able to break a lot of rules… because I didn’t know any better.”
- “I’m building a brand here.”
- “Sometimes I say it’s good to be a dumb blond.”
13:30 Coming up with the idea for Dry Soda
- “I go out to eat a lot, but I also have four children, and because of that it’s really been half my life I haven’t been able to drink alcohol.”
- “We want Dry to be an event.”
15:30 Executing on the idea and starting Dry Soda
- “I just tapped into everyone I know.”
- “I did at least a thousand tests on each flavor.”
- Sharelle’s lab was “was probably a thousand dollars total.”
- “Chefs love it.”
- “I was trying to do all of this for what at the time I thought was going to be $50,000.”
- “We’ve ended up being able to capitalize the company with $100,000.”
25:30 Launching the company
- “Within four weeks it was in like 30 of the top restaurants of Seattle.”
- After not being able to find a distributor, “I went myself into all the high end restaurants.”
29:00 Current state of Dry Soda
- Full West Coast distribution.
- Sold 24,000 bottles.
- “We don’t skew as female as I thought we would.”
- “We should be nation wide in the next 12 months.”
38:30 The market
- “There’s a great new market and it’s called the adult soda market.”
- Oversubscribed for first round of $750,000.
- “Everybody comes with some great beverage experiences but not so much that they’re jaded.”
VV Show #34 - David O. Sacks, Co-Founder of PayPal and Producer of Thank You For Smoking
What do you do after building and selling a business for $1.5 billion in the course of only a few years? That’s the question David O. Sacks, one of the co-founders of PayPal, faced after eBay bought his company. It didn’t take him long to find the answer: Go to Hollywood and make movies. David didn’t waste much time. He recently produced Thank You For Smoking which won critical and audience acclaim. Now you can hear about his journey and get his unique perspective on the convergence of media and technology.
1:30 Clip from Thank You For Smoking
2:45 Interests at Stanford
- Graduated in 1994
- Went to Law School: “The default path for people who are smart but don’t know what to do with their lives.”
- “I thought I missed the whole Internet boom.”
4:10 Coming back to Palo Alto in 1999
- “When I was in school there, Palo Alto was a pretty boring, sort of yuppie town.”
- “There’s just this whole sense of a crazy, money-soaked, carnival frenzy in the air. And about six months later it crashed.”
6:30 Getting involved with PayPal
- Original idea for PayPal: Beaming money from Palm user to Palm user.
- “In fact, I think PayPal was voted the worse VC-backed idea that year.”
- “I originally came on board being the vice president of strategy, which was a licence to interfere in any part of the company I wanted to.”
8:00 Winning with PayPal
- “If you didn’t have a good product, you didn’t have anything.”
- “There were all these companies out there running around making lots of business deals. The problem with that is you can make deals all day long but if you don’t have a great product that attracts users and does something they want to do, it’s all pretty much irrelevant.”
- “What I really started focusing my time on was figuring out how to make PayPal a really simple, intuitive application for people who wanted to send money online.”
- “What was different about PayPal, and I know it seems really obvious, is just that we decided we were going to be based on dollars -- were weren’t going to try to create a new currency, we thought dollars worked really well -- and we’re going to make it really simple and intuitive to use, so there’d be nothing you’d have to download on your end.”
11:00 Relationship with eBay
- “[PayPal] essentially compressed the amount of time it took for a buyer to complete the transaction from two weeks to a minute. And that tremendously accelerated the volume of commerce on eBay and was very beneficial for them.”
- “At the same time eBay kind of felt like they didn’t own their own cash registers.”
- “For about two years PayPal and [eBay-owned] BillPoint competed head on and eBay users stuck with PayPal.”
- “It was very intense.”
- “[PayPal] is the fastest growing financial service, I think, ever in history.”
- “We really believed in Andy Grove’s Only the Paranoid Survive.”
- “I did reasonably well.”
25:00 Moving from Silicon Valley to Hollywood
- “Hollywood’s very notorious for taking those people’s [people who come from outside the movie business] money and then emptying out their pockets and sending them on their way.”
- Set up Room 9 Entertainment.
- “This company’s read over 1,500 scripts.”
- Produced Thank You For Smoking based on the Christopher Buckley book of the same name.
- Worked with first-time director Jason Reitman.
- “It’s been about 10 years in Hollywood development hell.”
29:30 Producing Thank You For Smoking
- “Spin is a way of protecting us from political correctness.”
- “On some level, people want their vices.”
- “That’s the fundamental hypocrisy: We want these vices but we’re not willing to take responsibility for them.”
Clip from Thank You For Smoking:
33:00 The message of the movie
- “I think the common denominator between the movie and the other things I’ve done in my career is there probably is a somewhat libertarian bent to them.”
- “One of the things animating PayPal is the thought that we can make the world freer by creating a frictionless monetary system.”
- “We are going to look at some of the places were you’re getting technology and media converging.”
- Interested in companies like MySpace and YouTube.
- “They call them disruptive technologies.”
39:30 Cities of disruption
- “If I had to bet on Silicon Valley vs. Hollywood in terms of shaping future of entertainment, I’d probably bet on Silicon Valley just because that’s what it does.”
41:40 David’s movie and angel career
- “You want to work with people who are under recognized.”
- Making a movie about Salvador Dali.
See you at the Venture Voice Startup Workshop.
VV Show #33 – Announcing the Venture Voice Startup Workshop
Venture Voice has been illuminating entrepreneurship through the podcast for just short of a year. Now, at the Venture Voice Startup Workshop on June 26 in New York, you can interact with top entrepreneurs and venture capitalists to find out how to start and grow innovative businesses. Venture Voice, a podcast known for asking the hard questions about entrepreneurship, brings together highly successful speakers who’ve gotten their hands dirty growing businesses. This full-day event will be intense. Participants will leave with tactical knowledge about growing a business and with the inspiration to do so.
Tune in to this podcast to hear audio clips from some of the people who will be speaking at the workshop.
VV Show #32 - David Sifry of Technorati
Starting a service aimed at the blogging community is like jumping into a pressure cooker – all of the users are critics and have bullhorns. Good thing David Sifry, the founder of Technorati, has a thick skin he’s built after founding four businesses. He’s not one to go on the defensive. Dave, a first time CEO after serving as CTO at his prior ventures, simply wants to “be of service.” Technorati is now of service to many people. It tracks 2.3 billion links and is, in its own words, “the authority on what's going on in the world of weblogs.”
1:35 Starting career as engineer
- Worked for Mitsubishi Electronics in Japan.
- “I was the first foreigner to come into my factory in 17 years.”
- “Being a cog in someone else’s big wheel just wasn’t for me.”
- “I’m not an engineer.”
5:45 Learning not to engineer
- Started Linuxcare (now Levanta) in 1998.
- “Somebody had to pull my fingers away from the keyboard.”
- “Different people react differently under stress. You don’t want to hire a group of people who all react the same way when they get stressed out.”
- “You can’t just delegate responsibility. That’s only half the battle. You have to delegate authority as well.”
12:30 Authority and responsibility
- “If you can’t say ‘no’ then what’s the point of saying ‘yes’?”
16:45 Past ventures
- Started first business at age 16 in high school and helped to pay way though college.
- First business: Secure Remote.
- “You can plan yourself into failure.”
- Second business in 1998: Linuxcare.
- Third business: Sputnik.
20:15 Motives for starting Technorati
- “I think I’m just weird.”
- “I love doing what I do.”
- “That’s our mantra: Be of service.”
- “I firmly reject the notion that the primary reason for companies to exist is to make a profit.”
26:30 Purpose and profit
- “I sleep like a baby.”
29:45 Dealing with competitors
30:15 Scrutiny of bloggers
- “I work in a business where satisfied customers walk around with bullhorns.”
- “And I also work in a business where unsatisfied customers walk around with bullhorns.”
- Reason Technorati had growth troubles: “We forgot to buy hardware.”
- “I forgot to sign the order to buy more machines.”
- “I just screwed up. Mea culpa.”
37:00 Getting the word out
41:15 From CTO to CEO
- “Far more important than the technology you have is the team that you build.”
43:00 Sticking with Technorati
- “I can’t believe they actually pay me for this.”
VV Show #31 - Steve Hindy of The Brooklyn Brewery
Being robbed at gun point and being threatened by the mob are not problems the average entrepreneur encounters. Steve Hindy faced these problems and more, but what concerned him most was the fate of his brewery. Steve started the Brooklyn Brewery with Tom Potter. Steve was a journalist and foreign correspondent. Tom was a banker. Neither knew a thing about starting, much less running, a brewery. With grit and determination, they stared down bankruptcy and made it work. In 2003, they sold their beer distributorship for about $10 million. Now Steve’s focused on the brewery (which is doing about $12 million in revenue and has become a global brand) and on the community.
2:45 Starting career as a journalist and AP foreign correspondent
- “Somehow I got it in my head I wanted to cover a war.”
- “I was sitting behind President Sadat when he was assassinated in Cairo.”
- “Foreign correspondents tend to develop some pretty bad personal habits, much worse than beer salesman I can attest.”
7:30 Getting the idea for the Brooklyn Brewery
- “Entrepreneurship really takes all the creativity and all the resources that you have.”
- “I didn’t have the greatest resume for starting a brewery.”
- On convincing his partner Tom Potter: “When I suggested we start a brewery, he thought I was nuts.”
- On partnerships: “Misery loves company.”
17:30 Being in Brooklyn
- “Yeah, it was very difficult. We were robbed at one point. We had drivers who took off with our trucks. Our last year in business we spent $60,000 on parking tickets.”
20:00 Dealing with investors
- “We didn’t want to sell our friends down the river.”
- “What I learned about business is that a lot of people do sell their original investors down the river.”
- “In a lot of companies, people on the ground floor get crushed by the people on the floor above, or maybe the fifth floor above, who put in the right money at the right time.”
23:30 Building the team
- “I think early on, one of our best moves was finding a designer who could really do justice to the name Brooklyn.”
- Recruited Milton Glaser (who designed the I Love New York logo) to create the Brooklyn Brewery logo.
- “The first time I called there [Milton Glaser’s office] his secretary kind of blew me off.”
28:00 Selling the distributorship
29:00 Entrepreneurial terror
- “First time I read that I was just giddy with laughter, maybe nervous laughter.”
- “We were scared out of our wits early on.”
- “We got robbed at gunpoint at one time. We ended up emptying the safe of $30,000 cash to guys with pistols. And we had a run in with some mob types here in Brooklyn when we were building the brewery who basically were looking for bribes to allow the project to go on. But none of that was as scary as facing the possibility of failure, which is to me the most scary possibility.”
- “We’re just very determined.”
35:45 Turning point
- “We left behind the fear of total failure probably about 1995.”
39:45 Brooklyn Brewery today
- “Last year we grew by 18%.”
- “Craft beer as a whole grew by 9%.”
42:30 In the community
- “Having a high profile in the community has gotten us into trouble every now and then.”
- Brooklyn Brewery has supported Bruce Ratner’s plan to build an arena for the Nets in Brooklyn. Some bloggers called for a boycott of the Brooklyn Brewery as a result.
- “Brooklyn is a wonderful place -- two and a half million people. But it’s also a poor place. It always lags behind the city in employment. Brooklyn needs housing. It needs affordable housing. And Ratner has big plans for affordable housing in this new development.”
- “We have no regrets about supporting this.”
- “The boycott has not had any impact on our sales.”
- “No good deed goes unpunished. That’s something you got to face up to if you’re going to be involved in the community.”
Steve and Tom wrote a book about their experence called Beer School.
VV Show #30 - Scott Johnson of Ookles
Scott Johnson is a long-time entrepreneur on the bleeding edge of technology. He started his first business in 1987 and successfully sold it. Then he rode the dot com wave up and down with Mascot Network, a company that was trying to do what Facebook does now by providing online communities for college students. Most recently, he started Feedster, which after a lot of early traction ousted Scott Johnson and the CEO he recruited. Now he gives us the exclusive on the mission of Ookles, his new company.
1:30 Early career
- “When you grow up in family business you have one of two options in your life, I firmly believe. You either work for your family or you get pissed at your family and you go out on your own.”
- “I was full of piss and vinegar.”
- Started a hypertext software company and sold it.
5:15 Worked for Mascot Network in 2000, a company that was similar to what Facebook now is
- “If you’re going to appeal to college students, you’ve got to have subversive, viral content.”
- “It was a wild dot com ride.”
11:00 Time in transition and entrepreneurial ideas
- Left Feedster on 12/15/05.
15:00 Starting Feedster
- Got into blogging because of Dave Winer.
- Co-wrote the book Essential Blogging with Mena Trott and others.
- “A good day for me is getting up and programming for like 15 hours.”
- Started company on 3/03.
- Was funded by Marco DeMiroz of Selby Ventures. (This same firm funded Sharpcast which we covered at DEMO.)
- Competed with Dave Sifry’s Technorati, which raised far more money than Feedster did.
- “Dave’s wicked smart.”
- Brought Scott Rafer on as CEO.
31:00 What happened at Feedster?
- “I don’t think I’m allowed to say” what happened at Feedster.
34:00 New venture: Ookles
- “Next generation Flickr”
- “Photography takes on a whole different dimension when it’s of your kids.”
- “Flickr’s incredibly cool, but I sort of wonder if they don’t perceive photography in the same way because it’s more of a cool thing for cool people as opposed to a really important thing in their life.”
- “Ookles is full buzz word compliant.”
- “I’ll try to suck Robert Scoble into [using] this.”
- “You want to attract bloggers, even though they’re not exact target audience, but because they’re the equivalent of the 1980’s power users.”
44:00 Burn rate and market analysis
- “Our explicit burn rate is less than say $3 grand a month.”
53:30 Making money
- “I’d have no problem telling you if I was ready to do it today. I’m not.”
- “It’s not pay per click advertising.”
- “It’s vastly more expensive to live in the Valley.”
Photo credit: Scott Beale
VV Show #29 - Shoba Purushothaman of The NewsMarket
Shoba Purushothaman’s career has shifted dramatically since she started her first job as a business journalist in Malaysia. After spending several years working for the Wall Street Journal and Dow Jones Newswires, she grew restless just covering how the world was changing. She wanted to influence it. Shoba co-founded a public relations consultancy that helped corporations ride the wave of change brought on by the rapid expansion of television news. She saw first hand how inefficient video distribution was, so in 2000 she sold her first business and started The NewsMarket to make video distribution simpler. Though she weathered some tough times in 2001, she’s managed to build the company to millions in revenue and recently closed on a $12 million venture round.
1:40 Starting career as a journalist
- Grew up and started career in Malaysia.
- Worked for the Wall Street Journal in Washington DC.
8:10 Getting out of journalism and into business
- “I was taking a substantial pay cut.”
- “It took me two years before I could admit that I was no longer a journalist, that I had crossed over to the dark side.”
12:00 Taking advantage of the television news revolution
- “Most of our sales, and most of the sales that I’ve personally done, has been cold calling -- not networking driven.”
16:15 Selling to Fortune 500s
- “We often have situations where somebody refuses to take a meeting for a long time because they don’t believe that you have value and then they finally take a meeting and they go ‘wow, why didn’t I take a meeting earlier?’ Those experiences are hard to beat.”
21:00 Starting The NewsMarket
- “Probably the hardest thing for us was raising money.”
- “I have no doubt that it was harder to raise money then it was to win customers.”
29:00 Current state of The NewsMarket
- Revenues are in the millions.
30:40 The explosion of video on the web
33:20 Deal with Google
37:00 Rise of user-generated content
39:00 Entrepreneurial opportunities in video
41:50 Outlook for the future
- “I believe the opportunity for video is enormous.”
46:00 Advice for entrepreneurs
- “There are so many things out there that we’re doing that can be improved.”
Venture Voice updates:
48:15 Feedback from last show with John Bogle
VV Show #28 - John Bogle of The Vanguard Group
If you’re making lots of money in a fat industry for doing relatively little, then the last thing you want is a competitor like John C. Bogle. He founded The Vanguard Group in 1975 and revolutionized the mutual fund industry by slashing management fees. By creating the world’s first index fund, John showed investors they could invest in the market without giving a large portion of their earnings to fund managers. While it sounds easy in hindsight, it was a difficult path. John was fired along the way and made many enemies in the industry. But John, like any good entrepreneur, is a fighter. And at age 75, he’s still ready for a challenge.
3:30 College years at Princeton
- “I’ve always been a terrible idealist – or a wonderful idealist.”
- The mutual fund industry was described as “Tiny but contentious.”
- “I’m even more idealistic now than I was then.”
13:15 Executing on a senior thesis by starting a career in mutual funds
- Became head of Wellington Management Company by age 36.
- “I fell for it hook line and sinker.”
- “My merger partners… banded together and fired me.”
- “It was awful, I cried. And why wouldn’t you? But I know I’d made a terrible mistake and ended up paying a terrible price.”
18:00 Started the world’s first index fund
- A thousand times growth since start.
- “Fired with enthusiasm.”
- “I can assure you I am no saint. If you don’t believe that ask my wife.”
- “The more the managers take, the less the shareholders make.”
23:40 Idealism and execution
- “The Lord has created few people with a greater feeling of determination than I have.”
28:00 Keeping costs low
- “I’d be embarrassed to walk into an executive dining room.”
32:15 Values in a company
- “For God’s sake let’s always keep Vanguard a place where judgment has at least a fighting chance to triumph over process.”
38:45 Managers have usurped power from owners
- Describes this problem in The Battle for the Soul of Capitalism
49:15 Fighting corruption through the market
- “Mutual fund directors are pretty useless appendages.”
- “If I were persuaded it would never happen, would I start doing things differently? Not at all. I’d do them even stronger.”
55:20 Going against the grain
- “Nobody in this business had more fun than I had. Nobody.”
- “Entrepreneurship is about the joy of creating.”
VV Show #27 - Following Entrepreneurs at DEMO 2006
When a startup launches its first product, should it expect a lot of fanfare? It should if it launches at DEMO before an audience of hundreds that includes some of the nation’s top journalists and venture capitalists (not to mention Venture Voice). DEMO is a two-day conference, held in Phoenix this time around, that features about 70 never-before-seen technology products. Most of the products come from scrappy startups. We follow two of those startups through the process, Sproutit and Sharpcast. Along the way we’ll talk to countless other entrepreneurs on the floor and some people who came to pick companies to cover or invest in. We covered this event last year (part 1, part 2) and followed VideoEgg, which was recently funded by the venture capitalist we introduced them to on that show. Let’s see what happens to Sproutit and Sharpcast.
1:35 DEMO took place in Phoenix, Arizona
- “Mailroom answers e-mail, which is a pain that a lot of people feel – they’re [customers] willing to give us five minutes of their time just to see if it works.”
- “We’re an Internet company. You can do this from anywhere. Let’s put our money where our mouth is. So we moved to Prague.”
- “Go to Prague, save your money, so you can come party out in Phoenix for a few days and meet lots of press.”
- DEMO Superbowl party including The Wall Street Journal’s Walt Mossberg.
10:15 Introducing Gibu Thomas of Sharpcast
- Former company was acquired by Handspring, which is now part of Palm.
- “In those days it’s just you holding each other up.”
- “Entrepreneurship is often the triumph of passion over reason.”
- “The Treo didn’t become successful with multimillion dollars in marketing. It became successful because enthusiasts got the product and told other people about it.”
16:15 Introducing Mike Brown of Partech International
- “If we sell the company some day it will be enough to buy a small Korean automobile.”
- “Bootstrapping is not fun.”
- "Not having a lot of money actually bring a lot of disciplined to companies.”
19:00 Andrew Graham from Bones in Motion
- “We were on our third script when we realized we need to be true to the product. And it’s a storytelling product.”
20:35 Andrew Wright from Smilebox
- “If I had it to do over again I maybe wouldn’t have raised my round two weeks ago because I’ve had a lot of interest here today and I probably could have gotten a higher price… or… well, who knows.”
22:10 Oliver Starr of MobileCrunch
- "If you’ve covering technology and you’re not at DEMO, I think you’ve blown it.”
- “These is a phenomenon with these Web 2.0 companies, which many of these are, that they’re not built to be stand-alone enterprises. They’re built to be acquired by Google or Yahoo or perhaps even Microsoft.”
- “One is built to alter the entrepreneur’s pocketbook and the other one is built to alter the world.”
24:15 Mike from Partech on building companies to be big vs. acquired
- “I can’t really talk about them [getting acquired by Google].”
- “We’re all too lazy to really tag. You need some auto tagging solution.”
27:30 Evan Rifkin and Fred Krueger from TagWorld
- “Very similar in spirit to MySpace.”
- “You want one place to store all of this stuff [photos, bookmarks, video, etc.].”
29:30 Sproutit at the pavilion
- “Beer was only 72 cents back in Prague.”
31:00 Sproutit on stage
- "What if your sales guy is in Belize on a scuba trip?”
- “What are you going to do with all that time?”
37:00 Sharpcast on stage
- Chris Shipley introduction.
- “So many people complain to me about how difficult it is to get a picture off their camera phone. With Sharpcast, it’s about to get simple.”
43:45 Sharpcast debrief
- “Ultimately it’s the product that’s going to speak for itself.”
- “Actually, we were rewriting it [the script] this morning.”
47:00 Mike from Partech on investing in the companies at DEMO
VV Show #26 - Kelly Perdew is the Venture Voice 2005 Entrepreneur of the Year
Kelly Perdew may have won The Apprentice 2, but the listeners of Venture Voice have given him a new recognition for his entrepreneurial work since then. Kelly got the most votes for the Venture Voice 2005 Entrepreneur of the Year Award. Since we last had Kelly on the show, he’s started a number of new ventures. He announces on the show that he’s launching a new venture capital shop called Angel-Led Venture Partners. We also play your audio votes and get Kelly’s reaction.
- “That was quite stiff competition.”
3:30 Listener vote: Entrepreneurial while working for Trump
4:15 Launching Trump Direct Media
5:35 Listener vote: Achievements since winning The Apprentice
6:25 Kelly’s new book is Take Command
9:20 Listener vote: Kelly cares about the nation’s youth
10:15 Helping the youth
- Kelly is part of Big Brother/Big Sisters and National Guard Youth Challenge Program.
- “It’s still kind of weird to look at this as a quasi-celebrity status where I can impact things just by talking to the media.”
13:00 Downside of being on The Apprentice?
14:15 Launching Angel-Led Venture Partners
- Working with Luis Villalobos, the founder of The Tech Coast Angels.
- “It will enable me to help anywhere from 20 to 35 ventures grow.”
17:45 Working with angels
19:50 Juggling many ventures
21:45 Next three months
- Finalizing filming for the new GI Factory TV show on the Military Channel.
VV Show #25 - Jason Fried and Joel Spolsky Win Venture Voice Entrepreneurial Achievement Awards
The listeners have spoken. Jason Fried of 37signals and Joel Spolsky of Fog Creek Software have won Venture Voice Entrepreneurial Achievement Awards. They came in second and third place out of a pack of over 20 world-class entrepreneurs we’ve interviewed on the show (we’ll announce the Venture Voice Entrepreneur of the Year Award winner next week). It was a close race and you gave us some really impassioned votes. In this show, Jason and Joel give us some hints about what their companies are launching this year. They don’t get to have all the fun -- we play some of your comments too.
:40 Announcement of winners
1:05 Enthusiastic vote
1:55 Indecisive vote
- “See ya!”
4:30 Interview with Joel
- “And I did that without any venture!”
- Talks about CoPilot.
- “I’ll give away one [idea] in case you have any listeners that have a big pile of venture capital and don’t know what to spend it on.”
13:15 Votes for Jason Fried of 37signals
- “They’re not afraid to tell the world what they’re about.”
14:40 Interview with Jason
- “In ’05 we’ve launched 75% of our products.”
- “It’s a good 50/50, current products and new product development.”
- “Campfire is a group chat app.”
- “This is business chat, not dating chat.”
- “Sunrise is a CRMish app for small businesses.”
- “Sunrise is about managing people.”
- “Compass is basically another app that integrates all of our apps.”
- “We want to take this to the masses.”
VV Show #23 - Randy Komisar of Kleiner Perkins Caufield & Byers
It’s not easy to stand out at Kleiner Perkins, one of the most prestigious venture capital shops in Silicon Valley that counts Google in its portfolio. Though Randy Komisar joined the firm just this year, it’s clear he’s not a typical venture capitalist. He once was a lawyer, but openly admits to hating being a lawyer and has been running from the law (well, from the practice of law) for most of his career. He’s played top roles at Claris Corporation, LucasArts Entertainment and TiVo. Now he’s ready to build a legacy at Kleiner Perkins.
1:50 Started career as a lawyer
- “Where were you 20 years ago?”
- “I was a rock promoter.”
- “I went to law school on the misnotion that I needed to become a professional at something.”
- Went to Harvard Law School.
- "I was pretty miserable."
3:50 Unbecoming a lawyer
- “Nobody would confuse me with a lawyer today.”
- Got a job at Apple.
- Formed Claris Corporation.
- Was the CEO at Lucas Arts.
7:30 Winning in Silicon Valley
9:10 Entrepreneurship a profession?
- “If you look at the economy as a missile, we’re at the tip of a missile in creating new ideas and new opportunities on a global basis.”
- “If you’re a young entrepreneur and you need to tell your parents what you’re doing, I think it’s great to explain that it’s a profession.”
10:35 Becoming a VC
- “The opportunities to make a difference were happening so fast and furiously, that I was loath to be committed and stuck in any single one of them. I wanted to be able to work across a portfolio of ideas.”
11:25 “Venture management model”
- Bringing that model to Kleiner Perkins.
- “This gave be a sense of being committed and engaged in creating a legacy.”
13:50 Making a mark
- “The market gets to determine what the value is.”
- “I know a lot of venture capitalists who say they add a lot of value, and don’t.”
- “Don’t come to Kleiner Perkins for money. We’re expensive money.”
16:20 Deciding to back a company
17:30 What Randy’s done so far
- “Almost everything I’m doing is stealth.”
- Working with companies in these areas: digital divide, mobile voice and mashup communities.
- Co-sponsor of PodShow investment.
19:14 Wikipedia scandal with Adam Curry
- “It’s a disappointment.”
- “I thought that the response that Wikipedia had was fair, in the sense that if you’re going to create open communities you’re going to have to incur some inefficiencies in the process.”
20:10 Choosing a profession
- “I think that you should question authority.”
- “The shame of it is when smart people conform to conventional expectations and miss out on the opportunities to live a creative life.”
Randy Komisar joined Kleiner Perkins Caufield & Byers in 2005 as a partner. For several years prior Randy has partnered with entrepreneurs creating businesses with leading edge technologies.
He was a co-founder of Claris Corporation, served as CEO for LucasArts Entertainment and Crystal Dynamics, and acted as a "virtual CEO" for such companies as WebTV, Mirra and GlobalGiving. He was a founding Director of TiVo where he is currently chairman of the Nominating and Governance Committee. Earlier Randy served as CFO of GO Corporation and Senior Counsel for Apple Computer, following a private practice in Technology Law.
Randy holds a BA in Economics from Brown University and a JD from Harvard Law School. He is a Consulting Professor of Entrepreneurship at Stanford University and author of the best-selling book The Monk and the Riddle, as well as several articles on leadership and entrepreneurship. Randy frequently speaks here and abroad on such topics.
VV Show #22 - Introducing the Venture Voice Entrepreneur of the Year Award
We’ve interviewed some of the most accomplished and most hungry entrepreneurs on this show, but now the year’s almost over and it’s time to choose the Entrepreneur of the Year. We have no distinguished panel of judges or wise editorial board to make this decision. Rather, we’re leaving it up to you, our listeners, to decide. Listen to this brief show to find out more. Visit www.VentureVoice.com/Entrepreneur2005 to cast your vote.
VV Show #21 - Fabrice Grinda of Zingy
If you think the ringtone business is for kids, then Fabrice Grinda has a $130 million lesson to teach you. After starting the eBays of Europe and Latin America, Fabrice brought the ringtone business concept to America by starting Zingy. We caught up with Fabrice, now 31 and a millionaire several times over, just a couple of hours before he finished his last day at the helm of Zingy. While his possessions were in boxes, he put all of his cards on the table by telling us his net worth at every stage of the game. He’s risked all of his resources in the past for his ventures, but will he do it again? Listen to hear his plans.
Update (4/16/08): Fabrice announced on the Venture Voice blog that he's launched a new online classified business called OLX that's been dubbed a Facebook killer. OLX recently raised $13.5 million in venture funding.
1:15 Becoming an entrepreneur
- Born in Paris, grew up in Nice.
- Attended Princeton.
- Made several hundred thousand dollars by arbitraging computers between the US and France.
6:30 Types of entrepreneurs
- “I’m not very creative.”
- “On paper I look more like a businessman than an entrepreneur, just so happens that I’d rather not work for anyone else, and that’s why I’m an entrepreneur.”
7:15 Out of college
- Worked at McKinsey & Company.
- “After two years at McKinsey I realized that my goal in life was not to write a perfect PowerPoint presentation.”
9:30 Selection criteria for business
- Fabrice lists his criteria in this blog post.
13:00 Started Aucland in Europe and Deremate in Latin America
- “It’s incredible how unsavvy a lot of the French entrepreneurs were with regards to PR.”
- “I feel that it’s often better to make the wrong decision, and maybe fix it over time as you realize you made the wrong decision, then making no decision at all.”
22:30 Doing business in France
23:45 Investor follies
- Aucland was funded by Bernard Arnault, France’s richest individual.
- “The guy’s worth $18 billion, he doesn’t really care about making another $100 or $200 million.”
27:00 Picking the next venture
- “I had to become an entrepreneur again.”
- Found Jamba! was doing well selling ringtones in Germany, but no one was doing it in the U.S.
- Got the idea for Zingy.
- “I invested every last penny I had in [Zingy]. I didn’t mean to.”
32:30 Missing payroll
- “I kept making silly excuses to employees... they had heard it before.”
33:30 Seeds of success
- “It wasn’t really working because charging people by credit card is not a great model, especially when your consumers are teenagers and don’t have credit cards.”
- “I bought a deal with Microsoft.”
- “Finally, on August 15th, 2003, the check from Sprint arrives. And the first check from Sprint is like half-a-million dollars.”
39:30 When to cash out
- “I still have no money in my bank account.”
- “Then I’m like: ‘You know what, stop this, we’re not fund raising, we’re just growing the company.’”
- “The investment bank can be the bad guy.”
- Sold company for $80 million to a Japanese company.
- “So I sell the company and blow out all the numbers that we ever expected to blow.”
- Acquired Vindigo.
46:30 Quitting Zingy, moving on
- Traveling around the world.
- “I’m keeping my eyes open for the next big idea.”
- “The objective at the end of the day is to have fun and build a great business.”
- “Most people that build businesses to make money end up loosing because they’re not willing to sacrifice it all.”
- “We’re at the very beginning of the Internet revolution.”
VV Show #20 - Joel Spolsky of Fog Creek Software
While some entrepreneurs fret over new business ideas, Joel Spolsky of Fog Creek Software focuses on hiring the best and brightest for his New York City-based software company, and then figures out how to make a profit with the products they create. He bootstrapped his company to profitability and built a loyal following of fans along the way. While Joel developed Fog Creek's first product called FogBugz that tracks bugs, he let his 2005 summer interns develop their own product called Copilot that has already hit the market. Joel's out to prove he can put capital to work, scale his business, and maybe even revolutionize venture capital along the way.
Update: Joel returned for a second interview on Venture Voiceover three years later in 2009.
1:30 Starting career at Microsoft
- 'In those days Windows was remarkably cheesy.'
6:00 Gaining versatile skills in a big company
9:15 Starting Fog Creek Software
- 'I think what happened around 1999 when I finally made the decision to jump off, is that so many people were starting companies and they were being so successful -- and they were all so stupid -- that I felt I could probably do better than they did.'
- Released bug tracking software FogBugz.
15:00 Trying to build a content management system
- City Desk never really took off.
16:35 Bootstrapping a company with Aeron chairs
- 'Our model is to make the best working environment for programmers' leading to profit.'
19:30 Project Aardvark
- Used four summer interns to launch a new product.
23:00 Recognizing good business opportunities
- At a New York Tech Meetup, Joel felt none of the six businesses pitched addressed a pain that people have.
- 'I don't think you can make a high tech company in the long run that doesn't have geeks making the key decisions, unfortunately for the MBAs.'
28:00 Fog Creek Software management training program
33:45 Avoiding venture capital
- 'I think venture capital is radically misaligned with the needs of founders and entrepreneurs.'
- 'I wrote an analysis in those days called 'Fixing Venture Capital' -- it should have been called 'venture capital is broken' because I never got around to explaining how to fix it.'
- 'People are starting to think about exit strategies.'
Refers to Paul Graham article about VC.
- 'The VCs, basically, by refusing to invest in anybody during the nuclear winter of the dot com fallout, have actually, unfortunately, now created a super-breed of entrepreneur that is immune to the need for money.'
- 'At some point we might say, 'hey, the IPO window is open, let's accelerate a bunch of that future revenue, put it all in our pockets right now so we can spend it while we're young and good looking.''
51:15 Venture Voice listeners started podcasts
VV Show #19 - Derek Sivers of CD Baby
Many would-be tech titans dream day and night about how their hot new idea will change the world. Derek Sivers just wanted to have his independent band's CDs sold over the Web. No one would do it, so he built his own music store. CD Baby now generates $25 million a year in revenue and is the single largest digital distributor of music in the world according to Napster. And he did it without a dime in venture capital. Derek holds true to some very basic beliefs in business and a desire to keep revolutionizing the music industry.
1:30 Career as a musician and the birth of CD Baby
- Studied at Berklee College of Music.
- Got a job at Warner Brothers in New York City.
- 'Was working inside the music industry just enough to know I didn't like that side of things.'
- 'I was in a circus for 10 years.'
9:00 The importance of automation
10:30 Advice for starting a business
- 'Just give yourself a 10 day deadline, and just launch it' with almost no features.'
11:45 Training for business in the circus
- 'It was actually really good training that I had a boss that was just an idiot.'
- 'I'm usually the least slacker-like one in the crowd.'
- 'CD Baby is a total rebellion against the traditional world of distribution.'
18:30 Building a business in an unconventional way
- 'The joke is that CD Baby is run with all the corporate formality of Bob and Jimmy's tackle shop in Key Largo.'
20:30 Is building a business easy?
24:15 Company size
- About $25 million in revenue by 50 employees.
24:40 Steve Jobs encounter
- Integrated CD Baby with iTunes.
- 'The cool thing is we're friends with them all.'
- Mentions friendly competitor IODA.
- Loves the book Good to Great by Jim Collins.
34:15 No investors
- 'During the dot com days you kind of had to whack 'em [investors] off with a stick.'
40:40 Working with musicians
- Al Jardine of The Beach Boys and Thomas Dolby who created 'She Blinded Me With Science' use CD Baby.
- Started business in Woodstock, NY.
- 'I was up in the mountains with a 56k modem.'
- 'I was about to pick San Francisco until I realized what it cost.'
- Moved to Portland, OR.
VV Show #18 - Mena Trott of Six Apart
At age 28, Mena Trott is a veteran blogger and an accomplished company founder. Six Apart, the business she started four years ago with her husband Ben, now has over 100 employees. Its stable of popular blogging products (including Movable Type, TypePad and LiveJournal) are used by writers of all types -- from the most influential bloggers to children who communicate after school. She's still pushing her company forward as president and developing some very ambitious new technologies.
Towards the end of the interview, VideoEgg co-founder Kevin Sladek jumps into the conversation to announce a partnership with Six Apart. Venture Voice covered the launch of VideoEgg during our DEMO coverage (show #14 and show #15). Starting today, VideoEgg and Six Apart will add video capabilities to TypePad.
Show recorded at the BlogOn Conference. Under embargo until today.
2:30 Six Apart's four year anniversary
- Mena started the Six Apart at age 24 by creating Movable Type.
- 'The company kind of tricked us into starting itself.'
5:05 Transforming a hobby into a business
7:15 Starting a business with a spouse
- 'It's incredibly hard to work 24-hours a day and never to have a break. And that's what it's like to work with a spouse.'
9:05 First investor
- 'I think I'm a lot more sane now.'
12:55 Management team
- Brought in CEO Barak Berkowitz.
- 'An entrepreneur should realize their first and foremost goal is to have a successful company.'
16:15 Six Apart's software
- 'We use the stuff we build.'
17:40 Blogging to market a product
- Mena's professional blog is Mena's Corner and personal blog is Not A Dollarshort.
- 'We're able to express why we do things.'
- 'I was very aware from day one that it would be around forever.'
20:40 New product: Comet
21:45 Ambition for the future
- 'I don't know why we [in the industry] have to consolidate everything. Is it a case of only the big guys can survive? I think we want to disprove that.'
24:40 Communicating with employees
- 'I know that people will be listening to this at work [at Six Apart]. And they may hear things that they've never even thought that I would say.'
26:30 Announcing video integration into Six Apart product TypePad
29:00 What Six Apart is all about
- 'It's about communications.'
30:00 VideoEgg co-founder Kevin Sladek joins the interview
- Offering a test drive of video for TypePad users at typepad.videoegg.com .
31:40 Striking and managing partnerships
34:30 VideoEgg is moving to San Francisco
- Mena recommends locating south of Market Street.
35:50 Parting thoughts
- Mena: 'Not everyone in the company is drunk all the time.'
37:00 Venture Voice wrap up
- Does anyone know how to build a cone of silence?
37:15 Events to check out
VV Show #17 - Jason Fried of 37signals
The business world seems to keep getting more complicated, but Jason Fried is all about keeping things simple. When founding 37signals, Jason and his two partners staked their careers on simplicity. They wrote a manifesto to convince others of their philosophy of keeping design on the Web simple. Their project management software, Basecamp, has become a hit for its ease of use. Their blog is intently followed by thousands of (mostly) admiring readers, and has led to a book. Jason tells how he's grown his business simply, too, without taking on any venture capital or debt despite many offers. He also drops a couple hints about the next few products his company will launch.
1:45 Start of career
- Graduated college in 1996 with degree in finance.
- Started career doing freelance Web design.
- Started 37signals with and Ernest Kim and Carlos Segura.
3:10 Start of 37signals
- First Web site at www.37signals.com/manifesto.
7:50 Building Basecamp
- 'It happened by accident.'
10:00 Making Basecamp into a business
12:10 Getting the word out
- Blogs at Signals vs. Noise.
- Blogging 'offers a great opportunity to communicate with likeminded people, and also people who hate us -- that seems to be growing, which is good I think. Shows that you're saying something.'
15:30 Philosophy and vision
- 'Your customers will give you thousands of requests, and if you listen to each one of those, you're dead.'
22:00 Economics of 37signals
22:45 Launching other products
25:45 New products in development
27:00 37signals changes
- Currently five employees.
- 'We're really big into being small.'
- 'We make sure it hurts before we expand.'
28:30 Startup style
- 'We're not looking for investment.'
34:15 Business development and customer service
- Recommends the book The E-Myth.
- 'You need to be annoyed when [your customers] are annoyed.'
40:25 Exit plan
- 'We're not building this company to sell this company.'
44:30 Other thoughts
- Working on new book to be distributed as a PDF online.
- Published a book before called Defensive Design for the Web.
VV Show #16 - Tom Szaky of TerraCycle
Dropping out of college to start a technology company is almost a cliché. But is technology the only industry that can seduce an ambitious student into entrepreneurship? Tom Szaky dropped out of Princeton because he saw an opportunity in trash. At 19, he started developing an alternative to Miracle-Gro by using the excrement of worms that eat compost. To keep costs down, he reused soda bottles to package his product and located his business in Trenton, New Jersey. He's now got seven-figure funding and is pushing six-figure revenues by selling TerraCycle in select locations of Wal-Mart, Whole Foods and Home Depot. TerraCycle is planning on a full national rollout over the next three months. For this show we ventured into the heart of New Jersey to bring you on a tour of the TerraCycle factory. We talk with several TerraCycle employees and have an in-depth discussion with Tom about trash and cash.
2:40 Tour of the factory with Abraham Diez
6:35 TerraCycle size
- 12 exectutives
- 10 laborers
- 30-40 interns
- 'The average pay cut that our executives took to be here is like 80%.'
7:50 How Abraham got involved
9:05 How VP of Human Resources Elaine Gaughran got involved
10:20 How Bryan Chen got involved
11:45 Thoughts on Tom
- 'What I first met him, the man hardly slept.'
13:34 How Tom got into this business
- Started the business at age 19, now is 23.
- 'We ended up coming up with the type of machinery where we could make worm poop in a very large way.'
- 'We found ourselves the summer of freshman year at Princeton shoveling shit, literally.'
16:45 Initial funding through business plan competitions
18:15 Venture funding
- 'For any entrepreneur, that's what you really need, a simple, clear idea ' that's bankable. Within four months we'd raised $1.2 million from private investors and institutional investors.'
Now raising a second round.
21:15 The trick of winning business plan competitions
- 'When we give a PowerPoint, people standup and start smiling. Any they're like 'shit, finally I'm taking up.''
- 'I think we're a pretty damn sexy manufacturing company.'
26:15 Trenton, NJ
- 'Everyone's pulling for us here.'
29:30 Where you can buyTerraCycle
- In Canada: Home Hardware, Wal-Mart, Home Depot.
- In US: check Web site.
- In three months, should be available anywhere in the US.
32:15 Working with investors
33:15 College drop out
36:45 Schedule for today
- Meeting with Pepsi.
38:30 Watching TerraCycle grow
- Venture Voice's Greg Galant wrote a Business Today Magazine article about TerraCycle in Spring 2005.
VV Show #15 - Launching Companies at DEMO Conference
You might expect that if you launched your pride and joy -- your startup company -- at a conference, it would automatically be the center of attention. At DEMO, the leading technology product launch conference, you're hatching your business alongside 64 other companies with cool new technologies. You've got to deliver an awe-inspiring six-minute presentation, schmooze for many hours on end at a packed product pavilion, and be charming during the cocktail hours to make your mark. We continue our coverage of the DEMO conference by following VideoEgg's experience while grabbing audio clips from all over. Hear from Wall Street Journal columnist Walt Mossberg, August Capital partner David Hornik, Six Apart co-founder and president Mena Trott, U3 CEO and founding team member of Palm Kate Purmal, Jingle Network senior vice president Tom Latinovich and DEMO executive producer Chris Shipley.
3:45 VideoEgg co-founder and director of product and technology David Lerman
- VideoEgg is powering the video blog for DEMO.
- 'Woke up with a bit of a hangover, I won't lie.'
- 'Really, when the doors open and press started coming in, we just had no idea if it was going to work or not. Phenomenally, it's all worked.'
6:00 PR person
- 'My client, poor guy, is sweating buckets right now.'
6:30 David Hornik of August Capital, VentureBlog and VentureCast
- 'I think for sure [VideoEgg] will get funded.'
- 'If people aren't showing up at your booth you need to be proactive.'
8:50 Tom Latinovich of Jingle Networks, Inc.
- 'The bar is certainly the most fun.'
- 'The best value is not up on stage.'
10:20 Kate Purmal, CEO of U3
- 'We've been giving away U3 smart drives to everybody here, so we've been mobbed.'
12:40 Walt Mossberg, the author and creator of the Personal Technology column in The Wall Street Journal
- 'I've been coming to DEMO for probably 12 or 13 years.'
- 'I have always taken pains to try to find stuff from new companies.'
- 'Don't even try to show me PowerPoint.'
15:30 The beach
- David Hornik: 'I wake up in the morning, look out at the ocean, say 'Wow, look, there's the ocean' -- then I go into the conference room.'
16:55 Mena Trott, the president and co-founder of Six Apart
- 'Why do we think our moms are so stupid?'
18:40 VideoEgg co-founders CEO Matt Sanchez and director of business development Kevin Slavek
- 'There's always pressure.'
19:10 VideoEgg demo at DEMO
25:50 Debrief with Kevin and Matt
- 'It was a total blur.'
- 'We've heard it went very well.'
26:35 Unrecorded DEMO moments
VV Show #14 - VideoEgg Preparing for DEMO Conference
New businesses usually start small and work slowly and steadily to build their reputation. But that's not true of startups that choose to launch their product at DEMO, the most prestigious conference dedicated to launching new technologies. Presenters have to agree to be radio silent about the cool technology they've been working on night and day for the past several months, if not years, of their lives. Then they have six minutes on stage to show it off to everyone, and a couple of days at a beach resort in Huntington Beach to network like crazy and deploy their freshly printed business cards. VideoEgg, a new company founded by three Yale graduates from the class of '04, chose to hatch itself at DEMO after months of quiet incubation. In today's show, we're chronicling what it's like to present at DEMO by telling the story of VideoEgg. We'll interview VideoEgg's founding team, DEMO executive producer Chris Shipley and DEMO groupie David Hornik of August Capital. We'll post a show after the conference with VideoEgg's presentation and the crowd's reaction.
1:55 Talking with Chris Shipley
2:20 Most famous DEMO presenters
3:50 Who attends DEMO
- 25% investors
- 50% business development people
- Rest of the attendees from media, etc.
5:00 DEMO stats
- Expects 500 people to attend.
- It costs $16,500 to present at DEMO.
6:25 Worst DEMO presentation
- 'There are some really great technologists and really great CEOs who are really terrible actors.'
7:30 Format of the show
- Based in New Haven, CT.
11:30 Talk with VideoEgg's founding team: CEO Matt Sanchez, director of business development Kevin Slavek and director of product and technology David Lerman
13:00 What is VideoEgg?
- 'Video should be as easy to put up as photos, and it's not.'
16:00 Deciding to become entrepreneurs
19:05 Raising funding for VideoEgg
- 'We really didn't use PowerPoint.'
- Got first seed funds from CVT Ventures.
- 'It's easier to find them than you think.'
- Met with Howard Morgan and he backed the company.
- 'We have interns that sleep for us.'
24:00 Deciding to go to DEMO
- First Round Capital suggested going to DEMO.
26:40 Most important person to meet at DEMO
30:00 Naming VideoEgg
32:40 The fate of VideoEgg
35:00 Thoughts before DEMO
35:35 Conference call with Kevin and Matt before leaving for DEMO
- VideoEgg contracted Renee Blodgett to do PR.
- VideoEgg partnered with iUpload to make the an interactive booth at DEMO.
- Giving out iPod nanos for best blog entries.
42:00 Kevin and Matt's reactions on a Venture Voice interview with David Hornik of August Capital and Venture Blog
46:30 Last thoughts before DEMO
- 'DEMO is a watershed moment.'
VV Show #11 - Scott Rafer of Feedster
If you thought you're an entrepreneur just because you started a software company in Silicon Valley, you're dead wrong, according to Scott Rafer. It's just too easy. Scott's the CEO of San Francisco-based Feedster, an RSS search engine and ad network that allows people to find blogs, jobs and more. Scott is no stranger to the startup world, having been an entrepreneur in several parts of the world. He's not afraid to speak his mind, either, as a blunt blogger and speaker.
Update (4/5/08): Since this interview Scott left Feedster, which is now out of operation. He joined MyBlogLog as CEO and sold it to Yahoo! within a year for a reported $10 million. He's now the CEO of Lookery.
1:30 Career start
- Did an internal startup for Kodak at age 28.
3:00 Corporate entrepreneurship
- 'The resources were pretty good but you paid for them by having 10 or 20% of your time sucked up doing things that were not moving either your individual business or in fact the overall corporate business forward.'
- Reading Seth Godin's new book, Free Prize Inside.
- 'Startups are too easy out here' in Silicon Valley.
10:00 Previous venture
- Stared WiFinder, a WiFi search engine, on September 5, 2001.
11:15 Being too early in a market
- 'First issue is how do you recognize if you are too early? I'm personally not very good at it.'
- Co-founded WiFinder with Oren Michels, who now is VP of Engineering at Feedster.
- On the board of advisors of Digital Railroad, which is 'the next generation of what Corbis does.'
- 'What you have to do is fall in love with the channel,' not the product.
- 'So if you're too early with a particular product, figure out who the product would serve, figure out how they want to buy it, and sell them something much, much, dumber until the market comes to fruition.'
15:15 Feedster involvement
- Went to Kevin Werbach's Supernova conference.
- Ran into Fran�ois Schiettecatte and got stuck in the Baltimore airport with him for 5 hours.
19:40 The next Google?
- Building a specialized advertising network.
- Providing private label search to AOL.
- Competitor IceRocket is funded by billionaire entrepreneur and Dallas Mavericks owner Mark Cuban.
- 'Mark Cuban is awesome, clearly. However, sometime he sticks with something for years and years and sometimes he sticks for something for weeks and weeks.'
- Competitor Technorati 'they spend all their time, and as far as anyone can tell every single employee, trying to drive traffic to their front door.'
- 'I'm thrilled that the Feedster 500 kicked some serious butt.'
24:30 Founder relations
- Two founders: Scott Johnson (blog) and Francois Schiettecatte.
- 'I'm getting founder-like at this point but I'm clearly not a founder.'
- 'The working relationship, it's sort of like old married couples by this point.'
- 'One of the things on my list is to go find a big Chinese partner.'
- Jason Calacanis gave Scott a 'pat on the back' for the Feedster 500.
31:15 Political views and causes
- Blogs often about politics.
- 'The four of us are free speech nuts.'
35:30 Audio vs. text
- 'We don't have anything going in the podcasting world, because I don't see how to generate revenue from it nearly as efficiently as text. But I'm a little weird this way, I don't have a TV, I don't have a MP3 player.'
- Referenced show with Evan Williams.
37:35 West vs. East Coast
- Advisor to Wireless Ink on Long Island, NY.
- 'Silicon Valley and San Francisco, I hesitate to call those of us out here running companies entrepreneurs' it's too easy to get the infrastructure.'
- Mentions Ellen Pack who runs a sophisticated nanny business.
- Mentions Flickr as an example.
- 'Other parts of the world, they're like, you idiot, go get a job.'
- 'Most of the world is not friendly to starting even the most attractive of startups, never mind the crazy crap most of us do.'
48:10 Threats to Feedster
- 'I watch the larger players with a tremendous degree of paranoia.'
50:40 Speculating on the future
- 'My crystal ball is just as broken as everyone else's.'
Scott Rafer is President and CEO of Feedster, a fast-growing blog search engine and advertising network. Feedster delivers more relevant, and timely information by continuously collecting data from nearly 7 million RSS content feeds. Before Feedster, Rafer co-founded WiFinder, the Wi-Fi hotspot directory; BookBroadband, the broadband hotel finder; Fresher Information, RSS indexing way too early; and FotoNation, a creator of connected photography solutions.
Previously, Rafer led the Internet products group at Kodak Hollywood and worked in investment banking at Needham & Company. For school, Rafer graduated from the Management of Technology program at the University of Pennsylvania.
VV Show #9 - Jeremy Hague of Skylook
While some people still wonder if the fax machine has been rendered obsolete, Jeremy Hague is ready to write e-mail's obituary. Jeremy's brand new company, Netralia, recently released a product to rave reviews called Skylook. Many people use Microsoft Outlook to manage their contacts and send e-mail. Skype is used by 47 million people to make phone calls over the Internet. Jeremy's Skylook program allows users to integrate Outlook with Skype so they can quickly place calls to contacts, merge contact lists and optionally record phone calls. Based in Australia, Jeremy uses his own program do business around the world.
1:25 Career start
- In Melbourne, Australia.
- Started Netralia.
- Business partner is Paul Andrews.
- Works with Outlook and Skype all the time.
4:00 Description of Skylook
- 'So many people will tell you their Skype name before their e-mail address.'
- 'It's always cool for people to hear my accent and for me to hear other people's accents over Skype.'
8:10 Call recording
- 'We didn't really set out to make the best recording program, it just worked out that way.'
9:45 Integrating two pieces of software from different manufactures
- 'Were working with the model at the moment of a fortnightly update.'
12:45 User feedback
- 'One of the amazing things is watching what people have been saying on blogs.'
- Check Technorati to monitor what people are writing about Skylook.
- 'E-mail is becoming a bit dated.'
14:45 Phone calls are back among techies
- 'One thing I realized' if I can see that someone's there and that they're online, and that I know they're at their machine, it will actually plant the idea in my head of calling them.'
- 'We sort of see e-mail turning into instant messaging.'
18:10 Business plan
- 'Being in a corporate job for four years, you almost become a slave.'
- $29.95 per license with a 14 day trial.
- 'We're in that stage at the moment of just making sure that it's working for everyone and rocking their world.'
24:55 Managing time
26:05 Skype building in functionality
26:45 Young entrepreneur
- Age 26.
- 'I was chatting with my old man about this, and he said 'you can spend your whole life wondering or you can go and have a go' and I think that's a very Australian thing, just going and having a go.'
29:15 Australian entrepreneurial culture.
- Mentions the Venture Voice show with Scott Heiferman of Meetup.
33:20 Remote collaboration via Skype
- 'Usually a couple of times throughout the week we'll [Paul and I] meet up for a coffee. I drink a lot of coffee by the way.'
35:20 Try Skylook
VV Show #8 - Kelly Perdew, Winner of The Apprentice
If someone told us to listen to business insights from a former game show contestant back in the day when The Price is Right was the closest thing to a televised business competition, we would have laughed in their face. Since then The Apprentice has attracted many ambitious young professionals to do battle for a spot in the Trump Organization. The winners have all been entrepreneurs, and Kelly's resume has the word 'founder' repeated more than enough times to qualify him as a serial entrepreneur. Kelly is the winner of The Apprentice 2 and is seven weeks into his apprenticeship with the Trump Organization.
1:10 Career beginnings in the Army
- Went to West Point.
- Signed up for the Army at age 17 1/2.
3:25 Getting an MBA/JD
4:15 First venture
- ImageTel International, Inc.
- Raised half million in venture capital while in school.
- 'I can attribute a number of my successes to the training I received' in the Army.
6:30 Worked at Deloitte Consulting (then called Braxton Group)
- 'I was always the one at the company meetings with my hand up asking when we were going to do profit sharing.'
8:30 Worked at eteamz
- Won business plan competition at UCLA.
- Raised about $1 million from the Tech Coast Angels.
- Raised about $4 million more from venture capitalists.
- 'The only two sports sites that had more than we did were CBS SportsLine and ESPN.'
- Got acquired by Active.com.
- 'You can have the best idea in the world, and a fantastic team assigned to you ' and I do believe that you make your own luck ' but market timing really is very important.'
12:25 If you were filmed while you were working on all these entrepreneurial ventures, would you come off the way that you did on The Apprentice?
- 'I guess it depends who's editing it... just kidding.'
- 'I could see a little bit of myself and my past in each of the other candidates: Raj's wanting to be the center of attention. Andy's creativity in coming up with ideas. John's passion for stuff. Kevin's work ethic.'
- 'I understand that decisions have to be made with imperfect information.'
- 'I trust my gut a lot more then I used to.'
- 'You know when you know.'
- 'At eteamz we kept one of those spin dials on the wall that would either be a smiley face or frowney face.'
16:35 Pre-Apprentice enterprises
- Started MotorPride by bootstrapping.
- CEO of CoreObjects that built software for software companies.
- 'Seven or eight years ago venture capitalists wouldn't give you money if you were developing your software offshore because they were concerned about the intellectual property. Now they require it.'
- 'CoreObjects took advantage of that.'
19:00 Risk of appearing on The Apprentice
21:00 Appearing on The Apprentice
- Being an entrepreneur 'helped us [Bill Rancic and I] to excel in the different tasks.'
- 'I did not attempt to be entertaining.'
24:00 The technology industry vs. real estate
- 'I am definitely going to be spending a lot more time in real estate.'
24:40 Trump projects
- 40 Wall Street
- Trump Tower Tampa
- Trump Ice - 'It's the best water ever!'
- 'The buck stops with me on Trump Ice.'
- 'I haven't had to fire anyone yet.'
26:55 Business vs. entertainment
- On Trump's firing style: 'That's for the cameras and that's a big part of the show.'
27:30 On New York
- 'New York is the center of the business universe.'
28:00 Trump Organization
- 'I think that sometime down the road Mr. Trump and I'll be working on stuff together.'
29:00 What's next?
- Proposals can be sent to Kelly's official Web site.
- Contact may be made through Kelly's LinkedIn profile.
30:30 Book deal
- Deal with Regnery Publishing.
32:40 Apprentice's impact on America
- 'The Apprentice allows for Monday morning quarterbacking for business.'
36:20 To do list for today
36:45 The future
VV Show #7 - Evan Williams of Odeo
A quick glance at Evan's bio might make it seem as though he just stumbles into all the newest, hottest trends. However, the only thing Ev stumbled into was traffic (the kind you get on the non-information highway -- where he discovered the value of listening to podcasts) on his commute. After trying his hand in Nebraska's tech entrepreneurial circuit (well, he was the circuit), Ev made the voyage out west to California. He founded Blogger, one of the most popular blogging services, sustained it throughout the dot com bust with few resources, and sold it to Google. After spending some time at Google growing Blogger, he's back on the trail again building his new podcast business, Odeo.
Odeo is a young startup with fuel. Ev announces in this show that Odeo has just received its first round of venture funding.
Update (4/21/08): Ev returned Odeo's funds to the investors and sold the company. He co-founded Twitter, which just raised its own funding and is on a fast growth curve.
1:40 First gig
- First real job at O'Reilly Media.
2:35 Unusual places to build Internet companies
- Referring to Dick Costolo's remarks on our show about Chicago being a challenging place to start a technology company: '[Chicago] pales in comparison to Nebraska in challenges.'
3:15 Moving to California
- O'Reilly in Sebastopol.
4:50 From employee to entrepreneur
10:35 From geeks to general audience
- Launched BlogSpot to host blogs.
12:20 Google acquisition
- 'Until Blogger was Google-sized, it just wasn't interesting at the corporate level.'
- 'To Google's credit, they didn't screw it up, which is what a lot of companies do with tiny companies when they buy them.'
18:20 Odeo thinking big
- Met co-founder Noah Glass.
- First developed Audioblogger together.
- Adam Curry and Dave Winer were first to develop podcasting.
- Used Audible to pass time while commuting to Google.
- 'It seems like there are a hell of a lot more people in the world who don't spend their days in front of a computer than there are that do' The potential for audio content is possibly much greater than that of blogs as far as reaching a really mainstream audience.'
24:10 Other podcast players
- Apple 'made it much, much easier to use Odeo.'
- 'We [Apple and Odeo] work well together. I'm sticking with that story.'
28:05 Odeo's funding
- Until now, Odeo was angel funded by Ev and one other person.
- Just closed on Friday (July 22) some venture funding that will be announced this week.
- Won't announce who's funding it yet.
28:50 Podcast industry
- 'I think there are definitely gonna be people who make a living creating podcasts, or more generally, related to podcast in a bunch of different ways.'
30:35 The better suitor: Yahoo or Google?
- 'Podcasting is going to fit with Yahoo's strengths pretty well...'
32:25 Next six months
- 'I should probably take a hint from my co-opetition, Mr. Jobs and all the friends at Google, and not comment on such questions.'
- 'It's all about helping people when they come in the door go away with the stuff that they're most compelled by and interested in.'
VV Show #6 - Scott Heiferman of Meetup
Entrepreneurs need community. This entrepreneur makes communities. An Illinois native, Scott Heiferman came to New York while working for Sony in 1994. He quickly joined the avant-garde of the Silicon Alley community while growing his new media ad agency, i-traffic. After selling i-traffic to Agency.com (capitalized companies apparently acquire non-capitalized ones), Scott worked the counter at McDonald's. Scott left both the food services industry and the advertising business to create something unheard of: an on-line service that gets people to leave the computer.
1:35 Worked at McDonald's
- 'I felt like working, but I didn't want to hang out with any lawyers or accountants or investment bankers anymore.'
- 'It was really nice to get your hands dirty ' well, actually, my hands weren't dirty.'
3:15 Lessons learned
- 'We were never really told we should care too much about the customer, and that was a little surprising.'
4:30 Previous ventures
- Also started Fotolog.
5:30 Meetup thought up
- 'Meetup's a really stupid-simple idea that couldn't have been done before 2002.'
- Got involved in mid-90s with the World Wide Web Artists' Consortium.
- 'It was something that had to be done.'
8:15 Challenge of starting Meetup
- International Meetup days was an important part of it.
9:55 First Meetups
- 'It was interesting that it was the Slashdotters and the bloggers who first started using Meetup, because what's ironic about it is that these are the people that supposedly never want to leave the screen ' that they're most in love with the computer and why would they ever leave it? ' but they seemed to be the hungriest to want to connect in the real world.'
- 'Today the biggest Meetups are the moms.'
12:30 The Presidential election
- 'When people actually get off their butt and actually go to a local gathering about some political candidate or issue, that is newsworthy and that's a good newsworthy.'
15:00 Scott's Meetups
- Started New York Tech Meetup a couple of months ago.
16:20 Entrepreneurship geographically
18:25 Making Meetup successful
- 'It's a cliché, but it's true: it's all about the team.'
- 'Engage people to care, because it's one thing to make a great product, and it's another to make something that will get momentum.'
- Cites marketing writer Seth Godin about the importance of being 'remarkable'.
22:10 Media matters
- Huge fan of del.icio.us and flickr, but those brands are unknown to most people.
- 'There's one holy grail for anyone who cares about getting anything' no disrespect to the blogosphere but Oprah is where anyone should want to be. We've never gotten there, but if you really want mass America to know something, don't think it's anything but Oprah that can do that in 2005.'
24:05 Social networking?
25:45 Changing business model
- Some Meetups are profit making endeavors.
27:00 Meetup in the future
- 'Our goals are all about just more of the same.'
28:00 Podcasters' Meetup in New York
VV Show #5 - Joe Kraus of JotSpot (part 2 of 2)
We covered the past with Joe in our previous show, but it's clear he spends a lot of time thinking about the future. Many people muse about how they would do things differently if they had only the chance to do it all over again. Joe is doing it all over again by building his new business, JotSpot, from scratch. He shares his development strategy and vision for the company.
0:45 JotSpot elevator pitch
- 'Do it yourself application publishing.'
- 'There's nothing that allows an average person to create a Web-based application.'
2:45 Getting non-geeks to use JotSpot
5:45 Listening to customers
- 'Focus groups are not useful at all for telling you new concepts to be created. Focus groups never asked for the Sony Walkman. Sony created the Walkman. But figuring out how to make this new device easier to use, focus groups are really good at.'
6:50 Team dynamics
- 'I tend to like people who have a mass amount of raw, intellectual horsepower.'
8:45 Excite lessons
- 'The company had to scale up too fast for its own good. We had to grow so fast. I don't think we need to do it that way this time.'
- 'I have a no false positive rule, this time, which is that I'd much rather pass on people that could fit in JotSpot to make sure that we never get somebody who doesn't fit inside JotSpot.'
- Raised money from Redpoint Ventures and Mayfield.
- 'It took $3,000,000 to get Excite to market, it took $100,000 to get JotSpot to market ' a 30x difference.'
10:45 New competition
11:15 Prices for JotSpot
12:55 Developer community
- Hub of developer community at developer.jot.com.
- 'Our developer community isn't well developed, if you will, enough, to really be contributing to the core product in a major way, yet.'
14:00 To do list
15:00 Non-profit work
- Just joined the board of the Electronic Frontier Foundation.
- 'I've been allowed to succeed by an environment which has enabled me to innovate without permission. And I think that preserving that environment is critical. And I think it's under threat by changes to copyright law.'
17:45 Interesting opportunities on the Web
- On podcasting: 'Media that allow for what amounts to infinite variety will usually trump media, will always trump media that allows for only finite variety. That's the reason that cable and satellite continue to trump and erode traditional broadcast. But I believe media that allow for infinite variety but don't requite permission to publish will always trump media that allow infinite variety but require permission or media that does not allow hardly any variety.'
- 'Satellite radio trumps regular radio due to the first law, which is that infinite variety trumps little variety, but I think that podcasting trumps satellite radio because it allows infinite variety without permission. And that I think is amazing powerful.'
Excited about Odeo, Curry and Apple iTunes.
- 'In terms of content ownership, I don't see the traditional players dominating this market [podcasting] in any substantial way.'
21:30 A blogger but not a podcaster, yet
23:15 Copyright and podcasting
24:10 Advice to entrepreneurs
- 'I think now's a great time to be starting something. You can feel it.'
- 'If you got the bug, if you can make it work, do it.'
- 'It's cheap to start things these days.'
- Services like Rent A Coder and Elance make it inexpensive to outsource development.
VV Show #4 - Joe Kraus of JotSpot (part 1 of 2)
Conventional wisdom tells us to go get a job out of college to learn the ropes, not to take on friends as business partners, and to accept defeat gracefully. Joe Kraus's business war stories are anything but conventional. Before graduating college, he convinced five of his friends to pass on blue chip job offers to start a business of their own. What would that business be? They didn't know yet, but met at a burrito shop to come up with something. The rest is Internet history.
Joe was the founding president of Excite, one of the first well-known Internet search and content sites. After a merger, Joe left Excite@Home in 2000 and tried his hand at world travel, angel investing and politics. Unable to break the entrepreneurship addiction, Joe is now starting JotSpot, the first application-wiki company. More on his newest venture in the next show.
1:05 Starting a business out of college
- Graduated Stanford with a Political Science degree in 1993.
- Smartest person Joe knew: Graham Spencer.
- 'We borrowed $15,000 from our parents on a total flyer of an idea''
2:00 Catching the entrepreneurship bug
- First job: duplicating microfiche.
4:45 Working with friends
- 'I actually think that Excite wouldn't have survived had we not been friends.'
'We had this slogan that we were unencumbered by reality.'
- Joe convincing Graham to turn down job offers to start a business: 'You're smart enough to get a job at the top companies at any time, but rarely are you going to have the opportunity to start something on your own at a time in your life when you have so few commitments' it sounds funny to be making those statements when you're 21 years old.'
9:20 Developing business ideas
- 'We'd all brought ideas to the table of what we wanted to do, and they all stank.'
12:10 Raising capital
12:45 Power of persistence
- 'We acted as though we hadn't lost the deal.'
- 'The real negotiation begins at no.'
15:15 Excite's merger
19:20 Decompressing, angel investing and entrepreneurial addiction
Joe Kraus official bio:
Joe Kraus is co-founder and CEO of JotSpot, the first application-wiki company. A long time entrepreneur, Joe has been involved with early-stage technology development and starting companies for more than twelve years. Upon graduation from Stanford University in 1993, he joined with five engineering friends to found the highly successful Internet company, Excite, Inc. The original president of Excite, Joe was deeply involved in product strategy, direction and vision as the company grew. He also held senior operational roles in business development, international development and content.
After leaving Excite@Home in 2000, Joe was a co-founder of Digitalconsumer.org, a non-profit grassroots consumer organization with more than 50,000 members dedicated to protecting consumers fair-use rights to digital media. Joe, along with other co-founder Graham Spencer, continues to work on these important issues. In addition to his non-profit focus, he has also spent many years as an angel investor, working with numerous early-stage technology companies.
VV Show #3 - Philip Kaplan of AdBrite
This Internet bad boy doesn't think he's so bad, and one of the top venture capital firms agrees to the tune of $4 million. Don't know who Philip Kaplan of AdBrite is? Well if you were doing anything remotely dot com related in the late 90's you probably know who Philip Kaplan of F___edCompany.com (FC for short) is. His site grew famous, if not infamous, for posting the latest additions to the 'dot com dead pool.' Now with his current prize business, AdBrite, he intends never to join the businesses that FC featured.
Philip was not nearly covered as much for AdBrite as he was for FC, so we decided to catch up with him on the phone. He didn't sound as eccentric you might expect of someone with his resume, but he still has the attitude and smarts needed to be a dot com muckraker.
Watch that language: We try to keep our podcast pretty clean, but there's no getting around the F-word when talking about Philip's past (and Philip doesn't say 'the F-word'), so don't blast this podcast in your office if it's bring your child to work day.
2:35 The LA Times dubbed Philip Kaplan 'Internet Bad Boy'
- 'I'm probably not as bad as [spammers and hackers] but I'm flattered nonetheless to be in their company.'
3:10 Origin of FC
- 'We were happy to build sites for people but a lot of their ideas were quite ridiculous, and we would tell them 'I don't think this is a business, but I'll build it for you if you pay me in advance.''
- 'The whole dot com thing was ready for a major change and I figured there should be a Web site that chronicled it.'
- 'Did I write about my clients on FC? That probably would have been a good way to lose clients.'
5:30 Birth of AdBrite
7:30 Funding from Sequoia Capital
- 'Relatively few of the investments [Sequoia] they made, in comparison to the other the venture capitalists, made it onto FC.'
- 'Sequoia is well known for acting fast, they don't dilly dally.'
10:00 FC today
11:15 New York to San Francisco
- 'In New York you could go months without meeting another person in the Internet business, and you often do ' or years.'
13:15 AdBrite growth
- 'Part of the goal with hiring is to make sure that you hire people who you actually like.'
- 'People always want to partner with their friends, or they have this kooky idea that they're going to work on and they're like 'Oh, Bob and I are going to partner on this.' 99% of the time it's a mistake. The only time it's not a mistake is when that partner can absolutely, positively do something you cannot do yourself.'
- 'That said, I have two partners now.'
18:35 Profanity in Web sites
19:10 AdBrite blog
- 'The whole blog is an advertisement for AdBrite.'
19:30 Blog industry
19:55 Media matters
- 'The media never really knows what's going on with anything.'
21:40 Reading and watching habits
- 'I read surprisingly little.'
- 'I like it a lot either when they do [Biography shows] on serial killers or entrepreneurs.'
24:05 Philip's book, F'd Companies
24:30 New opportunities on the Web
- 'There's a ton of opportunity in search.'
- 'Nothing's happened yet on the Internet.'
- 'Somebody actually approached me, asking if I wanted to buy them or be involved in it. And I said no.'
25:50 AdBrite in three years
Philip Kaplan official bio:
Philip J. Kaplan is a 29-year-old entrepreneur based in New York City and San Francisco, USA. He has founded and manages a number of web-based properties. Philip is also the bestselling author of F'd Companies, and founded PK Interactive, an Internet consultancy that was sold in 2001. Philip's sites have been named "Site of the Year" by Yahoo!, Rolling Stone, and TIME Magazine.
VV Show #2 - Dick Costolo of FeedBurner (part 2 of 2)
Sick of potential investors not taking your phone calls? Pitch a venture capitalist on his iPod. Dick Costolo of FeedBurner tells us how his CTO did just that in the second and final part of our conversation. (Be sure to check out the first half too if you haven't already).
0:35 Team building
- Costoto: We don't hire people who say, 'Hey look, I was senior VP of biz dev over at XYZ Corp, I don't make coffee.'
1:25 How FeedBurner communicates internally
2:40 Communicating with investors
- 'You can't over-communicate.'
3:15 Customer support
- 'When people come in and interview for a VP job, we say everybody here does customer support.'
- Employees doing customer support must check Technorati to see what's being said about FeedBurner.
- 'When you're working 80, 90 hours a week, it's very hard to go read somebody's post who says Dick Costolo's a jerk and FeedBurner stinks and these guys are idiots.'
- Mentions Technorati CEO David Sifry's responsiveness to what bloggers say about his service.
9:35 No blog policy (or vacation policy) for employees
11:25 Making money by blogging and podcasting
- 'I think that blogs will provide a number of ways for people to make money.'
- Jason Calacanis at Weblogs, Inc. has a business that makes money by blogging.
- 'I went to a conference a couple weeks ago and someone said, 'How are we going to make money from podcasting?' I started laughing and said, 'Man, people have only been doing this since October.''
13:20 Reading and listening habits
- Subscribes to 60 or 70 blogs.
- Listens to podcasts when encouraged to on ad hoc basis.
14:30 iPod pitches to venture capitalists
- FeedBurner CTO Eric Lunt sent a pitch to Fred Wilson of Union Square Ventures.
- Groupcasts are made by tagging MP3s in del.icio.us and then processing them with FeedBurner's SmartCast feature.
- David Hornik of August Capital has done the same thing.
17:15 Business plan vs. elevator pitch podcast
- Elevator pitch podcasts (an audio pitch for a business idea that is delivered directly onto an iPod) offer 'quick attention, you're gonna get to these guys [venture capitalists] when you've got their undivided attention.'
17:50 FeedBurner's growth opportunities
- 'The biggest threat to our company right now is us screwing it up.'
20:30 Web 2.0 or bubble 2.0
- 'I don't think it's getting to be bubbly already.'
22:00 Process for picking new business ideas
27:20 Costolo's elevator pitch for using FeedBurner
VV Show #1 - Dick Costolo of FeedBurner (part 1 of 2)
Dick Costolo of FeedBurner joins us for our first show. FeedBurner provides services for publishers of RSS (Really Simple Syndication). RSS is an interface that allows users to access data from blogs, traditional media, podcasts and other sources in the way they want to view it. Dick's service is widely used and well funded.
1:25 FeedBurner is company number four for Dick
2:45 Got interested in RSS
- 'Despite the fact that a lot of people still don't know what the heck it [RSS] is, subscriber growth for the early adopters is really going crazy.'
7:30 Exciting new areas in RSS technology
- 'You're going to see a lot more specialized RSS clients.'
9:00 Bloggers as investors
9:55 Blog vs. business plan
- 'I would absolutely say that a blog is better than a business plan.'
11:15 Raising the first round of capital
- 'A lot of people that we were talking to, at least, didn't know how to spell RSS.'
12:45 The FeedBurner Founding Fathers
- "This is the first startup I haven't programmed in, much to the delight of the rest of the founders."
14:00 Life at the executive
- 'You're never more productive then when you're in that first, small, let's get stuff done and get stuff out, office.'
16:35 Phone answering and delegation
- "The hardest thing for me to delegate, as we grow, is the process of delegating."
19:05 Entrepreneurs as CEOs
21:25 Focus for serial entrepreneurs
- "I don't think I've ever been more obsessive or focused on the thing I was doing at the time then right now."
24:10 Chicago blues
- 'We talked to several VCs when we were doing our A round that said 'Really like the idea'hate that you're in Chicago.''
The next show (part 2 of this interview) will discuss team building, how to pitch a venture capitalist through his iPod and the biggest threat to FeedBurner. To be notified of our next show, add us to your RSS or podcast client, or enter your e-mail address in the box at the top right hand side.
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