Geek ‘n Rolla: Love & Money?

Love was defiantly in the air at this years Techcrunch Geek ‘n Rolla. The tech event, on its second year, had a strong focus on Venture Capital and real world startup experiences. The talks highlighted VC’s love of huge exits and startup entrepreneurs love of making great things. Unfortunately, these two paths to love don’t always meet. But often they both need each other to survive and grow. If you want a full debrief of the event Inma Martinez , Joao Belo and of course Mike Butcher at TechCrunch, have great detailed writeups.

In Tommy Ahlers‘s talk he compared a startup exit  to finding love and Eden Ventures described engaging with VC’s as romance. Tommy went on to say “don’t build a startup to sell out.” I’ve heard this before – if you just focus on the money you won’t get anywhere. In the subsequent panel discussion Saul Klein of Index Ventures went onto say “Most entrepreneurs are not looking for an exit, they’re looking to create a great product and change the world in some way”.

Jason Trost reminded us how much startups are “rollacoaster of a ride” and “to be ready for the hard knocks”. He also quoted the cold fact “that 7 out of 10 startups fail”. So why are startup founders willing to throw life savings, time and a personal life at an idea. It’s because Entrepreneurs love doing what they want to do! They love the freedom to create

The startup new product pitches of the day were: Cortexica; Cutefund.com; Decibel; DriveK; GameCreds.com; Gigaboxx; Graph.me; iGlue; LinkCloud.org; Musiio; Pownum; SongHi; and Stripped Finance. Well done guys for have the passion to follow your dreams. And congratulations to Cortexica for winning over the judges and Graph.me for the audience vote. Tamlin Magee has a great write up all the pitches.

Most of these startups have spent many months, or years,  and much money building their  products. Love of startups is why the speakers,  the pitchers and several of the audience were willing to drive across Europe for this event when all the planes had stopped. Well done Mike Butcher for making it these events such a focal point for European tech startups!

In Ewan McLeod’s talk on “The disruptive opportunities for startups in mobile, and getting traction fast” he pleaded with mobile phone app startups to stop their love affair with iPhone app development and look at the market measures.   “But love is blind and lovers cannot see, the pretty follies that themselves commit; For if they could, Cupid himself would blush” (William Shakespeare, “The Merchant of Venice”). This is where the VC’s kicks in!! They have to see the reality of money or at least the potential of it. “We’re looking for exit values of $300-400million dollars” Katie Turner, Eden Ventures.

However software startups are not about the money at the beginning. They can’t be – There is no money.. only an idea, a massive loss and very few customers, if any! Employees tend to focus on monthly paychecks but startup founders have to draw their strength and measures from elsewhere. Ultimately you have to do what you really love to do. Startup founders really have to enjoy and relish the startup challenge.  “I love sales” said the charismatic and slightly wacky  Morten Lund in his entertaining talk.

Without a rush of customers throwing money at a product startup founders have to deal with the VC devil to grow  their startup and continue to create. They then have to dance to the pipers tune and move towards a liquidity event. The good news is that once a VC is onboard they’re on the entrepreneurs side, just as long as the founders are moving towards that big exit 😉

The pointbreak of a live demo & product launch

There’s been much talk of demo’s and launches over the last  month with TechCrunch50 and DEMOfall09. It’s also been at the fore front of our minds with our startups launch and live demo at FOWA, London. I’ve posted about the pro’s and con’s launching at startup conferences. Launching at an event is an emotional roller coaster of a ride with the preparation effort required, pre-event expectations and then the post launch reality. Looking  back the launch peak is a brief moment in time after a long development  journey and before the journey to acquire real customers begins.

Killer Wave (Source: Telegraph ‘Beautiful but deadly’ )

Great  advice on  live demo and launch for startups includes: RRW and Jason Calacanis – Part 1 and Part 2.

Sean Power: “It may be the single biggest traffic spike you’ll ever experience.”, “After the bump, you’ll feel a tremendous rush of adrenaline, then deep, soul-sucking disillusionment as your traffic dwindles back to its former levels.”

There is so much effort needed to build and develop a product in preparation for a five minute launch demo (forgive me for my reminiscing links to many of my past posts):

1. Finding the team – Getting a great team together is not easy but it’s key to a successful startup.
2. Identifying the opportunity – Finding a killer idea first of is near-on-impossible or at least improbable.
3. Getting the investment – Making the money last long enough to build a working saleable product is a ‘Scrooge’ like challenge.
4. Building the app – Staying on target and not veering off on another exciting project is tricky.
5. Polishing the app – This takes time and you don’t have much of it. The devil is unfortunately in the detail.
6. Making it scalable – To prepare to scale or not to scale is a difficult question. No one knows the traffic and usage you will get.
7. Preparing a memorable demo – In summary Jason Calacanis says: show the product quickly; give a succinct presentation; temp the audiences; talk about accomplishments rather than roadmaps and show understanding of the competition.

Wow, what a journey!! This is why many startups fail to ever get a product  finailsed and launched. The decisions made during each of the above stages directly affects the outcome of the final 5 minute demo. However  this onstage  peak is only a brief  moment in time and a pause before the start of  a new journey.

After the curtains have closed at the conference its when the real hard work starts. You now have to convince customers and investors. The good news is that your startup will be taken a little more seriously because you’ve got a product. However, doubt will remain and very few really believe you have a good idea that will succeed because you have no customers. You now need to be flexible,  customer centric and have  a renewed determination to succeed.

The live demo launch is yet another emotionally intense thrill ride for startup founders. It is a deadline which gets things done and moves your startup towards the all important goal of getting customers.  “Buckel up because Kansas is going bye, bye.” – For the  5 minute demo anyway and then it’s back to reality 😉

I’m calling a ‘time of opportunity’ for London/UK internet startup industry

I’m getting very bored of being told we’re no good at Tech startup’s in the UK. I’ve calmed down since reading Paul Carr’s “I’m calling a ‘time of death’ for London’s internet startup industry” Guardian article, so this post won’t be a rant.  Admittedly Paul’s post is amusing , however he paints a very negative and bleak picture. If Paul is to be believed there’s no future for London/UK Internet startups. However, I believe there is hope and the UK Tech startup industry has great strengths.

Paul’s a journalist who once lived in London and is now housed in Silicon Valley. He believes “The London internet industry is increasingly, and terminally, screwed”. If Paul is to be believed shouldn’t we just give up! Why bother if  there’s no hope. While we are here lets cancel the 2012 London Olympics because the Beijing games were exceptional. There’s no way London could be the same. Just as we’re not Beijing, we are not Silicon Valley.

The Awesome Beijing Olympic opening ceremony drummers!! (Image source)

The investment funds sloshing around The Valley are huge compared to UK/European funds. The VC’s and Angel’s in the UK/Europe also tend to be much more risk adverse. Although these factors are changing  in the US with the credit bubble bursting. The UK’s limitations doesn’t mean we can’t produce a wonderful Olympics or make world class profitable web apps, we can. Huddle is a great example. Their ranked as one of the globe’s top 50 startups. Bebo is an excellent example of a very healthy trade sale. Sage a global leader was once a UK startup. The list of great UK startup goes on. Mike Butcher of Techcrunch Europe did a splendid job of correcting Paul on London’s startup profitability.

I and  many others agree that the Web 2.0 bubble is coming to an end. But the end is not death, it’s change. The Internet continues to deconstruct entire industries: advertising, music, newspapers etc. This change brings new potential innovation opportunities for existing and aspiring entrepreneurs alike. The Tech community has always been about and embraced radical change.  We are more adept at change than many other industries including Paul Carr’s Newspaper sector which Mike Butcher also pointed out.

The underlying Internet market continues to grow strongly. Ecommerce sales growth remains healthy even in the recession and the use of web applications are forecast to increase massively. The future of software is going to come from Internet based SaaS services and Open source. Again we have world leaders in the opensource sector with UK companies like Canonical and Alfresco. As entrepreneurs shouldn’t we take advantage of change to bring new opportunities. Or as Paul suggests should we give up hope and all the strengths that we have in the UK.

Geek n’ Rolla: Community, community, community

Mike Butcher of TechCrunch UK set a brisk pace at this weeks inaugural Geek n’ Rolla in London. The one day conference was packed with top Tech UK speakers including Inma Martinez, Andy McLoughlin and William Reeve. The Rock n’ Rolla gangsta theme was celebrating the UK’s entrepreneurial spirit. After all there are  very similar traits between entrepreneurs and criminals. They are both highly inventive, enterprising and resourceful. I and others felt the event created a real sense of community (a law abiding one that is).

The event was supporting and building the UK Tech startup community for startups like ours (Aware Monitoring). Lashings of helpful and informative advice was given out throughout the day from: Andy McLouglin on building a strong team; bootstrapping from William Reeve; Lesley Eccles on launching big in the USA; and working with VC’s /Angels from Fred Destin / Nick Halstead .  Daniel Tenner has a write-up of the talks in more detail. Some of the advice from the panel judging the 10 startup pitches at the event was brutally honest. I was really impressed with the standard of pitch. They were all very professional. Not a stutter or ummm amongst them. My money’s on the Booking Bug or Swiffen startups.

The networking was cosy with 250 people in a small space but it worked. I felt a real sense of community from the startups at the event and applaud Ian Hogarth for setting up community resources like startuptools. Mike Butcher did a really good job bringing everyone together. Well done, Arrington (Mike’s boss) would be proud ;). And I applaud any one who helps bring the UK Tech community together including the DrinkTank, OpenSoho and the Nott Tuesday organisers.

The Americans really get their Tech community efforts right in The Valley. Yes, I know the UK doesn’t have the funding or the close ties with Tech focused Universities like in The Valley but that’s the point. Guy Richie can make hit films and we can make hit apps. People keep reminding me the odds are against our website monitoring startup succeeding as we are located in the wrong city and the wrong county i.e. as a Tech startup we should be in London, UK or better still in the USA. I say that doesn’t mean we won’t succeed! Loads of great Tech startups and businesses have come out of the UK including Last FM, Bebo,  MessageLabs, Sage, etc.

I think the UK Tech scene is going from strength to strength. The community brings so many benefits: Sharing of ideas; sharing of problems; sharing of resources; sharing positivity and sharing ambition. After all, together we are stronger 🙂