Comments on: Setting the record straight

By: Jay (living in First Life)

Jay (living in First Life) — Thu, 26 Jul 2007 19:53:43 +0000

Derek – I do think you’re right that there is a lot more information available. You can just go to someone’s site or blog and email them. There are lots of events one can gain visibility at.
I will give incubators one thing – they do make life easier for those young entrepreneurs who lack any of the following:
1) Tremendous alumni network (Stanford, MIT, Harvard, etc.)
2) Personal network (family friends, parents of friends, relatives)
3) Access to contacts in a major city (Silicon Valley, Boston, LA, San Diego, NYC, Austin, Seattle, etc.)
I won’t comment on the average 21 year old, but I do know a decent number who have had the initiative to pull off getting their act together and launching a real business. I think that Generation Y is too used to being spoon fed and needs to have a little more chutzpah.

By: Derek Scruggs

Derek Scruggs — Thu, 26 Jul 2007 14:51:03 +0000

Jay,
That’s what I did with my first company. It’s probably a little easier now, but finding six people who are 1) knowledgeable, 2) have time to even meet with you once, and 3) like you and your idea enough to be on the board is *hard* and time consuming. I’ve spent the last 12 years building a network of these kind of people and could probably make it happen in a few months. (In fact, I did it last year for my current company.) But imagine a 21 year old kid trying to do that?
Also, their mentors hardly strike me as ambiguous. There’s a list of them at here.
Re: the 6% – in my experience the average first-time entrepreneur has no idea what percentage is appropriate. I gave 2% to the lawyer for my first company. I had no idea if that was high, low, whether it should vest etc. More of that kind of info is available now, but the overwhelmingly most common answer to those kinds of questions is “it depends.” The people most equipped to answer those questions are mentors. So here we are again in a catch 22.
Finally, I personally know many of the people behind TechStars so I’m biased. Brad Feld is on my board and I’ve known him for eight years. Giving up 6% to these guys is the equivalent of taking a low salary initially in exchange for the chance to have a leading role in a sitcom pilot. If the network picks it up and it goes big, no one will care about the 6%. And if it doesn’t, the 6% won’t matter.

By: Jay (living in First Life)

Jay (living in First Life) — Wed, 25 Jul 2007 17:30:09 +0000

Seth – thank you for emailing me and inviting me to respond.
Derek – I think you have a good point that mentors are valuable, but I disagree with your fundamental assumption – that giving up 6% to an incubator to have a set of mentors that they have pre-selected is worthwhile.
This isn’t 1950 that you need someone to really help you break into the old boys club. In the tech world, connections do matter, as always, but you can email whomever you want, call them, and see if they like your idea and are willing to give advice.
I would rather go find 6 people I want to be on my board of advisors and give them each 1% of the company rather than hand over 6% to people who may or may not help me and who may or may not be relevant to my business. It just seems like a crapshoot on top of the many risks one already takes as an entrepreneur.
That being said, good luck to everyone who is participating in these programs.

By: Jay (living in First Life)

Jay (living in First Life) — Wed, 25 Jul 2007 17:27:24 +0000

Seth – thank you for emailing me and asking me to respond.
Derek – you make a good point but I don’t thing the incubator model of institutionalized mentoring is the way to go. Different businesses need different mentors. Mentors should be chosen to compliment the team’s personal strengths so I agree with you for the most part.
That being said, why give up 6% for some ambiguous set of mentors rather than going out to 6 people you really want and giving them each 1%?
I think everyone who is willing to put in the effort and really trying to create something big will choose the latter.

By: Jay (living in First Life)

Jay (living in First Life) — Wed, 25 Jul 2007 17:26:55 +0000

By: Tom Chikoore

Tom Chikoore — Mon, 23 Jul 2007 09:06:39 +0000

I am news-free for a few days and this is what I find when I get back? The quotes in the USA Today article are laughable. I, personally, have seen how much time and effort you put into TechStars. You are there early for meetings, spend a lot of time doling out advice, participating and are usually the last person to leave the conference room. I have observed, first hand, the infectious passion you have for the product at TechStars and the genuine desire you show to see the product succeed. The quote in USA Today is very inconsistent with the time and energy that you have put in at TechStars. It is no secret that the survivability of a lot of early stage companies is questionable (some will and up as products, some as features, some as nothing). As a TechStars participant, I know all TechStars companies know that; that is not news to them. I don’t care what they say at USA Today, I am keeping you as an advisor any day Seth.

By: Cogblog

Cogblog — Mon, 23 Jul 2007 06:58:56 +0000

Should Little Guys Do Phone Interviews?

So, the other day, as part of my day job, I got interviewed by the Behavioral Insider. It was a phone interview, and as typical, after reading it I thought I sounded like a bit of a dork. (Although I love the comments on it so far: Great art…

By: Micah Baldwin

Micah Baldwin — Sun, 22 Jul 2007 08:32:51 +0000

My lesson on phone interviews continues to “follow” me around. In 2003, I had a 45min phone interview with a Fast Company reporter, who misquoted me. That quote, which was nowhere near what I really felt, was indexed in Google for my name, which when building a search agency was searched enough, making the quote a bit embarrassing.
It would be hard to imagine that you would have your level of involvement in the local tech community if you didnt think programs like TechStars had intrinsic value.
When reading each article/post, the message I got was that YC/TS should be viewed as no more than what they are a “hyper kick-start,” not a guarentee of success.

By: Graeme Thickins

Graeme Thickins — Sun, 22 Jul 2007 07:48:37 +0000

Seth, keep up the great work with TechStars. Misquotes or not, the positives about programs like these will keep shining through. We need some of this mojo in the Twin Cities!

By: Derek Scruggs

Derek Scruggs — Sat, 21 Jul 2007 20:12:30 +0000

“A small pre-product startup doesn’t need contacts. It needs a product.”
He didn’t say they get access to “contacts” – that’s they kind of bullshit bogus agents sell wannabe starlets just off the bus in Hollywood. (Or more recently, “consultants” in China he claim they have lots of guanxi with the local party officials.) He said they get access to mentors. Huge difference.
I started and sold a software company successfully in the late 90s, made a lot of money for me and my investors. Knowing what I know now, I would’ve happily given up 6% to gain the perspective of so many succesful software/Internet entrepreneurs. There were a lot of things I didn’t know and didn’t know who to ask. I was just another wannabe who didn’t know anyone, and back then there weren’t even any VC blogs on which to post snarky comments.
6% of nothing is still nothing. Mentors can help you find out more quickly whether you have something or nothing. And even help you refine the product before you go down a blind alley.