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Things I've Learned Sleeping Next to a Brand Manager

Fri, 12 Mar 2010 15:54:00 -0500

Being a VC, it’s easy to fall out of touch with mainstream consumers. I spend so much time with geeks and early adopters that I sometimes forget that most people have no idea what Foursquare, Blippy, or OMGPOP are. Some companies emerge into the mainstream, but not the majority of companies that I think about every day.

What some of these companies DO think about is how to get mainstream brands and advertisers to pay attention to them. That requires some understanding of the mainstream consumer but equally important is an understanding of how brands think about advertising and the process they have to go through to deploy their ad dollars.

Luckily, I’m married to a marketer who manages consumer products that do over $500M in annual sales. She’s launched products to both men and women and has worked with both very large and rather small advertising budgets. It’s been a huge help to get her feedback. I often think about advertising with a particular startup as a “no brainer”, until I realize how ignorant I am about what consumer product managers really care about.

So I’m going to do a little series on lessons learned. These may be no brainers to folks in the advertising industry, but they have been eye opening to me.

I’m also doing this because I think there is a HUGE gap in the way that CPG’s (consumer packaged goods) are currently able to use the internet to market their products. CPG’s are the biggest advertising spenders BY FAR. Yet online, they are the sixth largest category, and way behind retail, telecom, financial services, and autos. I think making the internet a better suited advertising medium will go a long way towards closing the time spent / dollars spent imbalance that everyone has been talking about for years.

Continuations: The Future of Browser Plugins (Hint: Let's Call them Apps)

Thu, 11 Mar 2010 09:22:14 -0500

Continuations: The Future of Browser Plugins (Hint: Let's Call them Apps):

At Union Square Ventures we have backed a couple of companies that use browser plugins at the core of their services (Adaptive Blue, Zemanta). We have always been concerned about the potentially lower sign-up rates from requiring someone to install a plugin. The installation process on Firefox…

The Most Important Lesson I've Learned

Mon, 08 Mar 2010 15:39:19 -0500

I’m in a zen mood today, and I’m thinking about the most important lessons that I’ve learned in my career so far. Most lessons that matter sound like common sense, but in practice are profoundly complicated. Although I have a ton more to learn, I bet this lesson will never fall out of my top 3.

The Most Important Lesson I’ve Learned Is: Big Rocks First.

I first heard this concept from my wife when she was in B-school at Stanford, but it turns out it’s one of those parables that’s widely repeated.

The gist is the following. Let’s say you have a bucket and a bunch of rocks. Some rocks are large, some are little pebbles, and a large number are tiny - like grains of sand.

The most efficient way to fill the bucket is to put in the big rocks first, which leaves room for the smaller rocks, which in turn leaves room for the sand. But if you go the other way around, you may run out of space before you ever get to the big rocks.

The life lesson is to focus on the things that matter first. Other things fall into place around those priorities. It sounds obvious, but it’s not in practice. We all get into a groove and sometimes do things out of habit without stopping to think why. Sometimes, we also just respond to things that happen to be pressing at the time, even if they aren’t the things that matter. Some people have called it the “tyranny of the urgent”.

The saddest example is when the small rocks displace things that really matter - like family, children, friendships, personal integrity, and faith. It’s amazing how easy it is for me to come home and be so distracted with what I’ve been working on all day that I’m not really present at home. My family gets my “B” game in those situations, but they deserve much more.

Big rocks first.

Hi. I live in Somerville and have a business idea I've been researching for a bit, which is one part online software app, and one part hardware device. I'm in the web/software consulting industry now, and have more than enough capability on the software front. The hardware, however is a different story. I've reached out to my personal network, and then even tried posting to Craigslist looking to pair up with someone, without any success. It seems there are a lot of software people out there, and not a lot of hardware ones. I'm wondering what your thoughts are on approaching this from the other angle and attempting to raise some sort of seed funding in order to just pay some people to develop the device, and concentrate on the web component, which is really where the innovation is.

Love the blog by the way.

-Michael

Sun, 07 Mar 2010 14:53:14 -0500

Thanks for the question michael. Not sure how complex the hardware component is. One thought is to try some sort of modular, open source hardware system like Bug Labs. Or find a contract manufacturer who could help build a prototype cheap. Or, you could even try www.quirky.com.

Features Don't Win

Wed, 03 Mar 2010 10:00:00 -0500

This is a continuation from my previous post about fast followers.

Several times a week, I hear a pitch from for a company that is fairly similar to existing players in the market. When I ask the entrepreneur how they expect to win vs. the various competitors, I’ll often hear something like:

“Well, they don’t have feature x, y, and z which has been built into our product from the beginning.”

These same folks usually include some sort of Harvey Ball chart to show how differentiated they are from their competitors.

My advice: if you need a Harvey Ball chart to show how you are different, you aren’t different enough.

In my view, winning as a startup doesn’t have that much to do with individual features. Features do drive success, but great teams and great product development processes drive features.

I saw a talk a while ago by Mike Maples. In it, he encourages entrepreneurs to “be different, not better”. I completely agree.

Being different means being WORSE than competitors in some dimensions. It’s a very intentional decision to forgo some areas of potential strength and choose the 1 or 2 dimensions that no one else is thinking about and absolutely destroy the competition in those areas.

Some examples? Tumblr, Zappos, Milo, Polyvore, etc.

Be different.

BRYCE DOT VC: Deal Fever

Tue, 02 Mar 2010 22:55:40 -0500

BRYCE DOT VC: Deal Fever:

The winds of change are sweeping into the start up scene once again. Spring is, er, springing and checkbooks are opening in full bloom. In our world, spring fever is being replace with a new seasonal condition. The companies who struggled to get VCs attention 9 to 12 months ago are closing up…

At DartBoston. Great vibe among under 30 BOS entrepreneurs

Thu, 25 Feb 2010 19:33:04 -0500

At DartBoston. Great vibe among under 30 BOS entrepreneurs

why doesn't the about link in your sidebar go to a page about you?

Thu, 25 Feb 2010 18:03:51 -0500

Thanks Kareem, it was a mistake and it now goes to info about me :)

Fast Followers Are Leaders in Disguise

Thu, 25 Feb 2010 14:00:00 -0500

All this talk recently about Groupon clones got me thinking about fast followers.

In competitive markets, fast followers pile on very very quickly. Every one of them says to themselves “the market is wide open, we can be the number 2”. There are 2 problems with this.

1. Most fast followers are not fast enough. By the time they notice that a leader is taking off, do the market research to validate the opportunity, and start to execute, it’s too late.

2. Most fast followers think features will help them differentiate. This will be a subject of another post. But features won’t separate you from a bazillion other followers. It’s also a mistake to think that the leader will stand still.

But the bigger point is this. Most fast followers are actually leaders in disguise. They are usually the same entrepreneurs who have a knack for anticipating where markets are going and executing with crazy speed and passion. What these folks find though is that they aren’t always right, so they have to pivot quickly. That’s usually how fast followers are born. They are usually entrepreneurs who already knew there was an opportunity in a sector, and were pursuing something that wasn’t quite right until they saw a leader emerge. Then they iterated and became #2. For examples, consider Living Social vs. Groupon or Booyah vs. FourSquare or RueLaLa vs. Gilt vs. vente-privee. Both knew about the success of the leaders earlier because they were already operating in and around the space. And both pivoted quickly and had the means to quickly create some separation from all the other followers.

Is It A Waste Of Time Talking to VC Associates?

Tue, 23 Feb 2010 09:23:26 -0500

There has been some chatter on Twitter about the value of pitching to VC associates. Thought I’d lob in my 2 cents on the shuttle to NYC. Full disclosure - I am a senior associate at Spark Capital.

Roles have blurred between associates, principals, EIR’s, and VP’s. Regardless of title, different roles have different levels of influence within a partnership. Over the years, I think we’ve seen some title inflation at some firms. It comes down to whether a person can lead an investment. In some firms, senior associates can do this in certain cases (I am able to lead seed investments at Spark). Charlie O’Donnel is an EIR at First Round (and a pretty young guy), but just led their most recent investment in Backupify. But in many cases, associates can’t lead investments, and even principles or young partners will get unusually high scrutiny through the deal process.
High quality intros to GP’s > talking to associates > low quality intros. I generally agree with Keith Rabois that you want to get to a decision-maker. It’s common sense, even if it hurts. If I were an entrepreur, I’d try to talk to GP’s I know personally or can get a high quality intro into. But the emphasis is on high quality. A low quality intro is sometimes not much better than a cold call. Also, if you don’t have a quality connection to a firm, getting an associate excited about your company works. An associate pushing for a deal is almost as good as a high quality intro. If not, that VC firm is wasting it’s $ paying that associate. There are many examples of great companies that met their VC’s through associates.
Careers are long and Venture is a young person’s game. In many cases, the associates of today are the GP’s or corp Dev execs of tomorrow. It doesn’t hurt to meet them early in their career as you never know where things will go. There are many good GP’s and angel Investors that were former associates: David Cowen and Alex Ferrara at Bessemer, many of the Battery GP’s, Alex Finkelstein at Spark, Chris Dixon, Jeff Fagnan, Larry Cheng, etc (sorry for the east coast bias, but this is off the top of my head). I wouldn’t burn a lot of time with fruitless meetings, but I’d certainly be respectful and get to know the guys I like. Some of these folks will be decision-makers soon enough.

So, those are my thoughts on whether to talk to Associates. Here are two tips if you are talking to them.

Be mindful of associates at transition points. Usually, these guys have been associates for at least 1 year, more likely 2. They are either rising stars that will be tested by leading a few investments or guys just trying to survive. If they are the former, they can be great assets. These associates will hussle harder than other VC’s to prove themselves and usually have champions within the VC firm who will give them a lot of support. The latter are dangerous because you might spend a lot of cycles with them and get nowhere. Even worse, they may advocate for a decision, get you funded, but leave the firm in 6 months. Be mindful of the risk of becoming an orphan and make sure you establish a strong relationship with the partner on the deal early.
Favor associates with clear domain expertise or a strong thesis. This can be based on their operating experience, blog, or just clear evidence that they know what they are talking about. Meeting these associates can at least be helpful, and typically have a higher liklihood of culminating in serious consideration by partners. It also helps you figure out which firms “get it” in your sector or do not. Typically, I’d be more wary of associates that are clearly chasing momentum. These meetings are less likely to be valuable and could also mean that you are part of competitive due diligence for another deal.

Sorry for typos, this was written on my iPhone.

What Lean Startups are NOT

Fri, 19 Feb 2010 14:10:03 -0500

The Lean Startup movement isn’t terribly new, but the level of hype is reaching pretty significant levels. The contrarian in me is always a little wary when anything gets overly hyped. To be clear, I really really like the concepts of the lean startup and customer development. I’d recommend any entrepreneur who isn’t familiar with this to at least watch some of Eric Ries’ talks about it and try to internalize Steve Blank’s book. However, I find that when lots of people start pontificating on topics like this, some parts of the message get lost or the framework gets portrayed incorrectly as some holy grail. Below are a few half-baked thoughts on what I think The Lean Startup is NOT (btw, I’m lumping the customer development methodology and Lean Startup Methodology together).

1. The Lean Startups Is NOT One-Size-Fits-All

I get a little worried when I see too many diagrams of work flows emerging around a particular methodology. I think discussing best practices is generally a good thing, but too much emphasis on the process sometimes fools folks into thinking that it’s a magic formula. I think the principles of Customer Development and the Lean Startup that are the most important things, and the process is more of a guide. Common sense and independent thought should prevail over workflows and formulas.

2. The Lean Startup is NOT Static

The reason that #1 is important is because the Lean Startup isn’t a static thing. Steve Blank and Eric Ries both often discuss how their thinking is evolving as they think about how their principles apply to different types of businesses and get feedback from folks who practice these principles. Industries and technologies shift as well, and some of the tried and true principles of the Lean Startup will eventually change or major limitations will become well understood.

3. The Lean Startup Is Not a Substitute for Vision

This is my most important point. Emphasis on creating Minimum Viable Products and finding Product Market Fit I think can be pursued at the expense of thinking hard about a company’s vision. It’s true that some big companies can/have emerged from iterating and pivoting into new markets (Groupon is my favorite example). But I think some really big and hairy opportunities can only be addressed if one really does the work to understand the problems and players and have a strong point of view of what could be possible. I think from there, you can utilize Lean Startup Principles to connect the dots, and the dots may lead somewhere very different (thus, vision evolves as well). But I think both are required to build industry transforming companies.

For example, I’ve talked a lot about what I see as a huge opportunity in the education publishing industry. I am 100% convinced that we are going to see a massive company emerge in this sector in the next few years. And it will be a company that completely changes the way students learn and how content is consumed. But it’s a complicated industry with lots of disparate players (an oligopoly of publishers, Professors, different kinds of educational institutions, Students, device makers, etc) and not one where you can do serious damage without some heavy lifting and crazy vision and conviction.

I’m interested to hear other peoples thoughts on this! Also, I want to give a quick shoutout to David Vivero and David Cancel, who prompted these thoughts from some recent conversations.

What's the Point of Ash Wed?

Wed, 17 Feb 2010 09:18:28 -0500

Today is Ash Wed. It’s not a very well known religious day, but it’s one I personally find particularly meaningful.

For those of you who are curious, here is a primer on Ash Wed. In a nutshell, it marks the beginning of Lent, which is the 46 day period in anticipation of Easter.

What I love about this day is its emphasis on humility. I think with the busy pace of life, it’s unfortunately easy for me to get caught up in my own self importance without even noticing it. So I really appreciate hearing the words that usually accompany the application of the ashes: “”Remember O man that you are dust, and to dust you shall return”

The interesting thing I didn’t know until a few years ago is that the ashes used on Ash Wed are from the palms from the previous year’s Palm Sunday.

I once heard a minister explain the reason for this. Palm Sunday was the day that Jesus of Nazareth was said to have entered Jerusalem amidst the cheers and adoration of the crowd.

The irony is that only a few days later, that same crowd would later make up the angry mob that called for his death. According to this minister, the use of the palms for the ashes symbolizes the frailty of human faith and goodness. It’s a reminder for me to be humble, because I can remember many times when I was self-righteous about something, only to later realize that I was guilty of a far worse offense.

I know my readers come from many different religious backgrounds, so this post may not be that interesting to a lot of you. But I like the thought of a day dedicated to humility. I was talking to David Cancel last week and he lamented the sense to entitlement he encounters from people from time to time. He said that he is a big believer in “servant leadership”, that you should just think about how to solve problems for people, or make life easier for your customers or those you work with. I thought that was a pretty darn good thing to focus on on Ash Wed this year.

Being an entrepreneur

Sat, 13 Feb 2010 13:37:21 -0500

caterpillarcowboy:

For the first time since November 2008, I’m getting a paycheck today. It’s not much ($930.46) and 1/5th of what I used to be paid, but I’ll take it. Needless to say, I have no money left and credit card bills to pay, so it’s coming at a good time.

Being an entrepreneur means sacrifice. I gave up my $3000/month beautiful Brooklyn loft for splitting a 2 bedroom with 3 people in Bayonne, NJ for $300/month. I was without health insurance for 15 months. And I can’t tell you just how much I appreciate J for putting up with living in Bayonne when I know she misses NYC and hates the commute.

Being an entrepreneur means being comfortable living on the edge. Last March, when I was still in Brooklyn, I had a $3000 rent check due in 2 weeks, and I didn’t have the money to pay it. And yet, you find a way. I was able to secure an investor and pay my rent on time.

Being an entrepreneur means riding a rollercoaster. One day in December, we’re celebrating because an angel investor told us he wanted to put in $200,000. Over the following weeks, we agree to a price and terms, and then he pulls out. From what Chris Dixon writes, this is more common than it should be. In the end, though, I think it was the best thing that could have happened to us.

Being an entrepreneur means compromise. Having no money means you can’t buy what you want, go out to eat whenever you want, travel wherever you want. But in return, you get to create something meaningful, be your own boss, and love what you do.

I wouldn’t have it any other way.

The Magic of Aardvark

Thu, 11 Feb 2010 13:54:31 -0500

I was very pleased to read about the acquisition of Aardvark by Google. I’m a huge fan of the service and the team at Aardvark. A part of me wishes that they had stayed independent and swung for the fences, but I also think that this is a great outcome and the team can make a lot of great things happen as part of Google.

The acquisition made me think about what I love about Aardvark. I started out writing a post with a list of attributes, but I realized that I only really have one point to make:

The Magic of Aardvark is that it changed my online behavior.

Aardvark is a pretty unique service, but there are others out there that try to do “human powered search”. But what blows me away about Aardvark is that it drives users to do something unique. I’m not the kind of guy who goes to Yahoo answers, but for some reason, when Aardvark asks me a question, 80% of the time I’ll at least think about whether I’m able to provide a good answer, and often, I will respond. If you look at Aardvark’s user metrics, they show that I am not alone. Power users to drive most of the answers on Aardvark, but unlike sites like Yelp or Tripadvisor, it’s not 1% creating 99% of the content. It’s much more balanced, which I think yields much more balanced results.

There are a lot of startups out there that have a unique feature or two… at least until they are copied. But once in a while, startups emerge that get you to say “wow, I can’t believe that people are actually doing x, y, or z”. Those companies usually end up being worth a lot. Recent ones that have come on the scene are Mint (“I can’t believe people are giving their banking passwords to a startup”), Foursquare (“I can’t believe that people actually check in to places”), and Blippy (“I can’t believe people are publishing their puchases”).

Now, I’m not advocating that companies try to make users do something unnatural to them. But what these startups all do is remove the barriers to inherently natural behavior. I already like to help out friends or friends of friends who need advice, and Aardvark allows me to do that in a natural way.

If You Are a 20-Something Entrepreneur in Boston, Check This Out

Thu, 11 Feb 2010 08:58:00 -0500

I previously wrote a To-Do list for new entrepreneurs arriving in Boston. It included a bunch of folks to follow on twitter and on their blogs, events to go to, and companies to get familiar with.

I’d like to add a new to-do on the list, especially if you are a younger entrepreneur. Check out Dart Boston - a community of entrepreneurs 30 and under helping one another start their businesses. These guys have sprung up out of nowhere in recent months, and I’ve been really impressed by their level of activity and creativity. For example:

Pokin’ Holes: A weekly meetup and video show where one local entrepreneur presents their company and gets grilled by their peers. The show moves around Boston in an effort to engage the entrepreneur community in different areas. Tonight’s event is at Tufts.

Capitalize: A monthly show where one company pitches to a VC or angel investor. You get to see the pitch and feedback streamed live. This month, it was at Kepha Partners with Eric Hjerpe. In May, I’ll be on the show at Spark Capital.

Rule 53: A podcast that features a series of interviews about startup life, business, and tech.

I don’t know how these guys and gals have time for all this, but I’ve been very impressed and think it’s an excellent addition to the local tech scene.

Take control over your destiny

Thu, 11 Feb 2010 08:39:01 -0500

bijan:

I’ve seen a number of consumer startups trying to reach massive scale by doing deals with carriers or device manufacturers (cell phone manufacturers)

Some worked out nicely for the startups but most don’t.

I like consumer startups that are taking charge of their own destiny. They are not white labeling their product or brand. They are not licensing intellectual property. They are not comprimising the user experience to make the big “partner” happy. They are not indifferent to those decisions.

Instead they are 100% focused on the user (and developers) and establishing their brand and purpose.

Awhile back I wrote about a problem I encountered when I ported my phone number. I asked for a better way to communicate this info to my friends, family and business associates. I received about a dozen emails from startups going after this problem. Unfortunately most of them built a product and approach that assumed that a deal with carriers was better if not essential.

I’d like to think that the open web and open mobile platforms allow us to finally go direct to our users and figure this stuff out together.

Now there are times where partnership and distribution deals make sense. I like them if they add value to the network and don’t hide the consumer brand or force the startup to make unnatural choices.

But in the absence of those things, I say damn the torpedoes and take control over your destiny. Don’t outsource it.

(clarification: this post is about consumer applications. i’m not talking about infrastructure or technology licensing companies, etc).

The Hottest VC No One Has Ever Heard Of

Sun, 07 Feb 2010 14:00:00 -0500

What do Admob, CafePress, Aardvark, Polyvore, and Xoopit have in common? If you said that they were all backed by great VC’s like Sequoia, August, Benchmark, and Accel, you would be correct. But did you know that they are also all backed by the same seed stage investor as well?

What these companies all have in common is that they are all portfolio companies of Harrison Metal Capital. With 3 exits in 2009 (Admob, Xoopit, and GeoAPI) Harrison Metal is one of the hottest of an emerging category of investors that some call “Micro VC’s”. Harrison Metal isn’t alone in their success - there is Maples Investments (SolarWinds, ngmoco, Chegg), Founder Collective (Hunch, 20x200, Milo), and probably another dozen or so firms like these that have emerged over the past 5 years.

What these firms all have in common is a fund strategy and size that is both different from and complimentary to traditional VC’s. Their investment strategy and sub $50M funds are well suited for the increased capital efficiency of certain sectors and the fact that larger VC’s have difficulty deploying capital in $1M chunks. It’s also a very attractive option for entrepreneurs in that it preserves option value. Mike Maples puts is best:

“Smaller up-front investments create a greater range of exit strategies where everyone wins. For example, if a business raises a small amount of initial capital, then exceeds its early milestones and decides to swing for the fences, it can then raise a larger sum at a higher price, while preserving ownership. If the business is not ready for rapid growth, it preserves the option for an exit at around $50 million, while still delivering a high return for investors. This dual-track model is less available to companies that raise large amounts of money early.”

It should be noted that most of these fund aren’t shooting for mid-sized wins. But their size allows them to do quite well with mid-sized wins, and it is well suited for consumer internet investments where it’s often very difficult to predict whether a company has the chance to be big enough to produce “venture returns”.

I think these firms are excellent investments (looking from an LP perspective). Their strategies fit the times and inefficiencies in the market. They also do wonders for their local entrepreneurial ecosystems by allowing more companies to get shots on goal and providing the help that sophisticated investors can bring. They are continuing the work that great angel investment pioneers like Ron Conway who helped (and continues to help) great companies emerge.

As an investor at Spark, which currently invests out of a $360M fund, I am very excited about these guys. Even though we also do seed stage investments, it’s great to be able to call on sophisticated seed investors that can partner with us and add serious value to companies on hiring, product marketing, and strategy. These funds also bring a lot of excellent deal flow, and give companies great counsel on how to approach VC’ and how to hit the milestones that matter earlier. This increases the pool of great companies that we have a chance to invest in and gives us greater leverage on the seed investments that we pursue.

UPDATE: Notch up one more exit for Harrison Metal - Google acquired Aardvark for $50M.

Top VC Website vs. Blog Traffic

Wed, 03 Feb 2010 12:34:17 -0500

Larry Cheng at Volition Capital has put together some excellent lists of top VC bloggers and top VC websites by traffic.

Obviously, these measurement methods aren’t perfect (he uses a rolling 3 month average of unique visitors from Compete), but they are directionally correct. What I found interesting is the correlation (or lack of correlation) between website traffic and aggregate blog traffic from all firm bloggers. I took Larry’s two more recent lists and did this comparison. The results are below ordered by website traffic:

Fund Name – (Website Traffic / Total Blog Traffic)

1. First Round Capital – (31,632 / 28,039)

2. Sequoia Capital – (22,441 / 0)

3. Bessemer Venture Partners – (14,825 / 8,262)

4. Highland Capital Partners – (12,704 / 0)

5. Garage Technology Ventures - (12,375 / 82,838)

6. Draper Fisher Jurvetson – (11,823 / 12,010)

7. New Enterprise Associates – (11,762 / 0)

8. Kleiner Perkins Caufield Byers – (10,924 / 0)

9. Polaris Venture Partners - (10,217 / 16,991)

10. Benchmark Capital – (10,162 / 23,084)

11. Battery Ventures - (10,034 / 1,744)

12. Founders Fund - (9,654 / 21,462)

13. Accel Partners - (9,604 / 0)

14. Greylock Partners - (9,445 , 0)

15. Centennial Ventures – (9,224 / 0)

16. General Catalyst Partners - (9,086 / 0)

17. Summit Partners - (8,270 / 0)

18. Norwest Venture Partners - (8,198 / 0)

19. Founder Collective - (8,189 / 42,937)

20. Spark Capital – (7,834 / 15,487)

21. Foundry Group – (7,787 / 71,547)

22. Technology Crossover Ventures - (7,503 / 0)

23. Matrix Partners - (7,309 / 0)

24. Lightspeed Venture Partners - (6,475 / 15,199)

25. Union Square Ventures - (6,333 / 132,936)

Some interesting observations:

1. There are a lot of zeros. It was surprising to me to see how many top firms don’t appear to be blogging at any scale. Again, Compete may fail to report the traffic of some of these folks, but that probably means that scale is minimal. That said, most of the excellent firms like Sequoia, Accel, Kleiner, etc have good reach with their websites regardless of whether or not their partners blog. I also know that at least one zero will go away with the next version of the list since David Skok started what looks like will be an excellent blog.

2. Blogging puts firms on the radar. It’s interesting to see some relatively new firms come on the scene in recent years and build very broad awareness. For better or worse, brands do matter somewhat in venture, and it’s always a tricky thing for a new fund to figure out how to create awareness. I think expressing your thinking openly and engaging the tech community in a dialog is a great way to do that. It’s impressive to see Founders Fund and Founder Collective gain mind share very quickly. And part of it has to do with one or two very vocal individuals who put their thoughts out there. As a side note, for those of you who do not read Chris Dixon’s blog or Dave Mcclure’s blog you are totally missing out.

3. Social media creates unprecedented reach. Event the best known firms only get 10-30K hits on their website. It should be no mystery why that is - the content is rarely refreshed, and it serves mostly as information and marketing pages to entrepreneurs who are researching a particular firm. But blogging (and social media in general) expands the voice of VC’s way beyond a bio and list of companies. It’s content that’s actually helpful and appeals to a much broader audience. Union Square Ventures for example has over 100K uniques, 20x the uniques on their website. And the richness of their content justifies it (for example, see Fred Wilson’s new series on MBA Mondays).

This last point makes me think more broadly about the reach of VC’s on the internet. Stay tuned as I pull some additional data together.

Details for my next Open Office Hours on Feb 12

Tue, 02 Feb 2010 13:35:52 -0500

I will be holding my next “Open Office Hours” on Friday, Feb 12, 2010 from 9AM – 11AM. This is my third Open Office Hours session - I’m having fund and hopefully folks find it helpful.

The purpose of these meetings is to provide the Boston entrepreneur community greater access to investors for their perspective, feedback, and help. I will schedule six 20-minute time slots, so please respond quickly if you are interested. The format is informal, but time is short, so please be very clear about how you want to utilize this time.

The location this time will be the Andala Cafe in Central Square.

Please see below for details and how to reserve a spot.

Location: Andala Cafe, Central Square (286 Franklin Street)
Date & Time: Feb 12, 2010. 9:00AM – 11:00AM
How to reserve time: Send an email to julie@sparkcapital.com with your name and preferred time. Also include a brief (< 3 sentence) summary of a) what you are working on and b) what you hope to get out of the meeting.

See you there!

Dear B-Schools Who Want To Prepare Entrepreneurs

Sun, 31 Jan 2010 14:00:00 -0500

Charlie O’Donnel and Jon Steinberg recently wrote two excellent posts about the value of business school and advice to graduates looking to join a startup. Their feedback is quite challenging and a little negative on MBA programs. I’ve said myself that most MBA’s are unable to really build something or sell something, which are basically the only two jobs that matter at an early stage company.

I do fear that the sentiment around MBA’s is swinging a little too negative these days. I’d like to offer a slightly more positive view, and some suggestions to MBA programs to better prepare their candidates.

Unlike some graduate programs, an MBA is not a trade. You don’t walk away with the ability to do something unique like you would coming out of dental school or law school. In fact, most people who go into business school are actively leaving their “trade”, whether that’s banking, consulting, product management, sales, or something else.

So what’s the point of Business School? In my view, the point of an MBA at a top tier B school is to provide students with the perspectives and pattern recognition to be a really great C-level executive. It allows a person to feel like they have “seen this movie before” in more situations and respond more decisively. There is a TON of value in this, but the further you are from making meaningful decisions in an organization, the less useful this learning becomes.

In my view, MBA entrepreneurs shouldn’t be looking to join great startups. They should be looking to start great companies. If they feel poorly equipped to do that, that’s a signal that they went to Business School too early. I love the example of guys like Brian Shin and Dharmesh Shah who had started companies in the past, went to B-school relatively late, and used the resources there to cultivate their next company.

Unfortunately, I can’t change the way Business Schools operate overall. The talent market is such that students are applying to Business School earlier and top tier schools are trying to admit younger students as well.

So here is what I would do differently at business schools to make students more effective in the startup ecosytem.

1. I’d make sure there is a class on early stage product creation. This would include the nuts and bolts of forming a founding team, best practices in early stage product marketing and product management, and best practices in early stage customer acquisition. I think this class should also require students to produce something and find users. It could even be as simple as starting a blog and attracting readers - it doesn’t matter.

2. I’d push more students to take classes in sales. I would make most of this learning occur outside of the classroom. Imagine if you could create a program where a bunch of top tier MBA’s are working for different companies and actually helping them sell product. That would be tough to coordinate, but make a big difference.

3. I’d rethink the case method. The case method is great at creating a lively, analytical discussion. You can generally guarantee that a class of 50-90 students will pick apart the main issues of a decision, and discuss all the costs and benefits of all the options. The problem is that business isn’t about analysis. It’s about decisions. And decisions are as much about the gut and conviction to trust your judgement as it is about analysis. During my two years in Business School, I don’t think I ever felt the the discomfort in my stomach that comes with making an important decision with incomplete information. But that’s what has to happen all day long at a startup (or in any management role).

4. I’d push students to get out of the campus. B-schools are great a bringing in great speakers and executives. It’s easy to get complacent. But entrepreneurship tends to be a local endeavor in the early days. You have to recruit locally, fund-raise locally (usually), find your first customers and partners locally (usually), etc. Cities like Boston, New York, and SF have a lot of resources for early stage entrepreneurs and have thriving startup-ecosystems. But I rarely see a B-school student at WebInno, OpenCoffee, PopSignal, or other local events. Maybe the situation is better with the NY Tech Meetup, but I’m not sure.

Those are my thoughts - and I’d love to to whatever I can to help MBA programs better equip students for roles at early stage companies.