Introblogtion

Introspection for a blog is a good thing, and will always be part of any good blog. Old media doesn’t do as much of that, they don’t have to wonder what is their core purpose — they know that their job is to deliver advertising. The good ones try to reach that goal by being interesting, etc., but that’s not why they exist.

(That said, it’s clear that the big papers will soon be much like sports teams, owned by people with oversized egos. The two best examples are David Geffen trying to buy the LA Times and now Rupert trying to buy the Wall St. Journal. Warren Buffett and I spotted this trend at the same time!)
A blog is different. Well, it is for all those people who aren’t so nefarious as to get into pay-per-post, etc.

I’ve seen two great bits of introblogtion recently from two of the best.

The first one is from A VC:

I know one thing for sure. This blog has to have a personal feel or its just another windbag pontificating about technology and we already have enough of that on the web.

The other one is local to me, Brad Feld. In that one, he makes a connection between what he read about Global Warming and what a reader sent to him complaining about the blog.

Both are good, but Brad’s, I think, does what good blogs do best, which is make connections between things that may not seem to be connected.

Now, you may be asking, why am I linking to two different VCs in a blog that is designed to talk about how to avoid VC? That’s a good question!

Posted in Declarations, Fantasy Business League

Here’s a CreditCardVC Role Model

Don’t think that it’s actually possible to start a company using only credit cards and then have it grow until something good happens?

It’s a good thing that Randy Morin didn’t think that way.

He started a project in his spare time and it just sold to NBC Universal.

This was certainly not a blockbuster deal, just one of dozens of deals like this that happen every week, most of them getting little or no mainstream media attention.

But, lest you think it’s easy, take a look at this quote, which instantly enshrines Morin into the CreditCardVC hall of fame:

And lastly, do you have any tips for someone starting their own business?

Let’s start by saying that 95% of Americans and Canadians don’t know what an honest days work is. Most people reading this will likely say they are part of the 5% that do. Those people should ask themselves a simple question. Do you honestly work 40 or more hours per week? Remove lunch. Remove water-cooler downtime. Remove all breaks. Remove personal phone calls. Remove solitaire. If you are part of that 5%, then do it. But don’t quit your day job. Do it part-time until you can pay the bills.

That sounds like a guy who groks the CredictCardVC manifesto.
OK, back to work for me.

Posted in Declarations

Ooopsie

Look, I love TechCrunch. It always seems to have the news I’m interested in first. I should have written posts about all the things that I saw TC do properly.

But this was too sweet to resist.

Here’s TechCrunch yesterday, wirting about how Google is going to be announcing a replacement for Power Point:

They acquired Writely, and (mostly) built their spreadsheet application. The smart money is saying this is a build, not a buy.

Then today I read on the unofficial Google blog that Google has bought a company for its Power Point replacement.

The main guy at TechCrunch, being a stand-up guy, immediately posted an update to his post, and even teased himself a bit in the process. Because he’s a class guy, he didn’t write, “From now on I won’t believe anything from the source who told me that Google will build this in house.”

But I bet he’s thinking that!

Posted in Uncategorized

Thanks for nothin’

If you are building a company, and you are hoping that company has a healthy exit some day, the way to do that is to focus on what it is you are doing, and do it so well that some larger exit opportunity comes along.

It’s kind of Zen, but you really can’t focus on the exit, you have to focus first on the task at hand. Sure you have to be smart, be well positioned for an exit, etc., but most of getting well positioned for a good exit is the same stuff you have to do to run a smart and solid business in the first place.

There’s a flip side to all this, however. If you do have an exit; If your company does get bought by some larger company, the way the rules of this country work, and the way the rules of human nature work and even the way manners dictate is that after the exit, it’s no longer your thing. It belongs to the ones that wrote the check. You have to just let go.

Here’s an example of two otherwise fine young men screwing that up. If you don’t want to click, it’s the story of two guys quitting Google because — grab your Web 2.0 Kleenx — they weren’t getting enough attention from their bosses.

So…. Alex and I quit Google on Friday.

It’s no real secret that Google wasn’t supporting dodgeball the way we expected. The whole experience was incredibly frustrating for us – especially as we couldn’t convince them that dodgeball was worth engineering resources, leaving us to watch as other startups got to innovate in the mobile + social space. And while it was a tough decision (and really disappointing) to walk away from dodgeball, I’m actually looking forward to getting to work on other projects again.

Whhaaaaaaaaa!

Look, if these guys want to quit, I have no issue with that. Fine. It’s the whining about not getting enough attention that rankles me. If they wanted to complain privately, I’m sure they could and some other sources could make their case in probably a much more effective way, as in this post from A VC pointing out how Google really is just a big company now. He easily could have written that post without having to link to that whiny missive.

I speak from direct experience here, as my first company was bought by bigger guys. I suppose I could have complained about something or another (though probably not as it was a great transaction.) And now that I’m out looking for investors in my next thing a connection from California through New York actually made it back to Traffic.com in Pennsylvania. The key guy there had great things to say about the whole transaction. If I had complained publicly, would I have gotten that positive back-channel feedback? I don’t think so.

And worse, I’m now running a great business, one that won’t be as big as YouTube or DoubleClick, but still could be a great acquisition for Google or some other big name. Knowing the bad taste left in the collective mouth of Google about this Dodgeball thing, aren’t they going to be just thismuch more shy about all the deals that are less than $1.5 billion?
Look, if you didn’t get the support you needed from within the acquiring company, that says more about your inability to work within the structure of a big company. If you can’t succeed at that, don’t blame the big company for acting like a big company, blame yourself for not being better at playing by those rules. If you just don’t want to be good at it, that’s fine, but don’t burn those bridges… other people may still want to use them.

So, thanks for nothin’, Dodgeball.

Posted in Declarations, Fantasy Business League, Uncategorized

First-Name basis

I heard that Cher and Madonna are friends. They’re on a first-name basis.

Over at my day job, the worlds best legislative database, we struggle sometime with our name, which can be hard to prounounce.

It’d be nice in some ways to go out and spend 30 Large on some consultant to come up with a great name, but that’s not the Credit Card VC way.

Luckily there are some great (free) naming resources out there, and some of them don’t even take themselves too seriously.

Natural Structures

Posted in Declarations, Money Savers

Cheating

Don’t do it.

I know sometimes it’s tempting, especially when mothers are going around cheating on board games with their own children just because the mother — not the child — is bored.

Michelle Hastings admits she’s sometimes cheated to get through a game of Candy Land with her 5-year-old daughter, Campbell. The board game can take just too long, she said.

Candy Land?!?!?

I’ve played Candy Land plenty of times with my 3-year-old son. The game doesn’t take that long, and if he was bored he would just walk away, but he never does.
What does this have to do with running a business without VC? Simple: Follow the rules, don’t get bored, stick with it. If that woman wants her child to learn to succeed, and not to cheat to fulfil her own need to be constantly stimulated, she needs to start right now.

Same for us: If we want our businesses to succeed, we need to behave ourselves in the way we want the business to behave; with real confidence, determination, stick-to-itness, and above all trust.

OK, maybe it’s not that related, but thanks for letting me rant.

Posted in Declarations, Fantasy Business League

Just grok it

Every once in a while I notice when someone writes something that makes me think they grok the ethos of Credit Card VC. I’m not saying they are foolish enough to actually use credit cards to finance a business, but they are simpatico with the notion.

This morning, in comment No. 7 to this post about an acquisition of a Sacramento company made me laugh so hard I almost spilled by grapefruit juice.

Shhhh…you’re not supposed to mention Sacramento. Don’t make us send our catering crew over there…..

1st rule of building a startup in Sacramento is you’re not supposed to mention Sacramento

2nd rule of building a startup in Sacramento, is you’re NOT supposed to mention Sacramento.

3rd rule of bootstrapping in Sacramento, is that if we are mentioned frequently on TC or elsewhere our talent and engineers get recruited to SV/SF, only to return when the bubble goes limp, taps out or bursts.

4th rule of bootstrapping in Sacramento is try and talk to local Angels and VCs before you have to drive to Menlo Park

5th rule of building a startup in Sacramento is it costs even less here.

6th Rule of building a startup in Sacramento is build something with a product and value, you can’t sell a burn rate, man.

7th Rule of Sacramento start ups is you can bootstrap as long as you have to.

8th Rule of Sacramento startups is, if this is your first start up here, you will probably be doing another…

Grats to the MaxPreps team, they’ve been at it awhile. Always good to see other local teams making good.

PS: There is no Sacramento Startup Club, and if there were we deny its existence.

Very nice. I don’t know what Allen Sligar’s company does, but I wish him luck.

On the other end of the spectrum, and I hesitate about doing this but just can’t resist, is YouniversityVentures .com. This is a VC outfit that only funds companies that are alums of the schools the founders attended. Heh.

Remember in college the guys who talked about high school a bit too much?

Posted in Uncategorized

Here’s some good news out of DC

How often do we get to say that?

The Wall St. Journal has a story out this morning that Congress is considering a tax break for Angel Investors.

The idea, as reported, is that investors would get to write off as much as $250,000 per company — up to $500,000 per year — in Angel investments.

It sounds awesome, though part of me wonders if the unintended consequence will be way too many Angel investors, and too many investments going to stinky companies. The investor will have already written off the investment, so they may see any possible gain down the road as something like winning the lottery. The upshot: Who cares if they don’t really understand the business model or have much faith in the founders? They were going to be writing a check to the IRS, and now they will be writing it to some startup, so how much do they care if the company they invest in is going to passionately go after a new idea?
I think it’s a risk worth taking. All the good jobs are being created by startups, and it’s just the way the world is going. If there are a few more dogs out there, oh well.
(One shameless plug joined with a hint of Catch 22: My company, LgDb, the Legislative Database, would be really useful to the Wall St. Journal, and any other blog writer or publisher of any kind to allow people to easily see the proposed legislation, and all of the associated links. That way people could easily read the actual bill, which is something I wanted to do after reading that Journal story, but I knew there was no easy way to do it. If the bill was in Colorado, I could do that now, but LgDb doesn’t yet have Federal stuff. For that, we need an angel investment. Catch-22.)

By the way, I know that the fact that LgDb is looking for investors is not totally consistent with the idea of Credit Card VC, but as I write in the Credit Card VC manifesto, if an idea is big you shouldn’t stifle it by keeping others away from helping you to grow. You can’t throw a big party AND keep all your beer in the fridge.

Posted in Declarations, Fantasy Business League

Spiritual Ancestors of Credit Card VC

I stumbled across Founders at Work, and was immediately entranced. Guy Kawasaki had the same reaction, and quoted some of the best bits, including this: “All the best things I did at Apple came from (a) not having money, and (b) not having done it before, ever.” That’s from Woz, who founded Apple with Steve Jobs.

(I always feel a special kinship with Woz, because like me and Bob Redford, we attended CU Boulder, but did not graduate.)

Reading through the list that Guy has, it’s amazing how many of the quotes have to do with NOT spending money.

Focus, determination, drive, passion — those are the things most often talked about when it comes to success in entrepreneurial ventures. Money makes the world go ’round, but it is not the key element of success.

Posted in Declarations, Money Savers

The Pitch for Angel investment

This is a forum for those who don’t want VC. If you are funding your own startup yourself, be it with credit cards or whatever, you are in a sense your own Angel investor.

Last week I attended an event in which five companies made a pitch for an Angel investment. The driving force behind the idea was Boulder’s David Cohen, who wrote about the event on his Colorado Startups blog. It was also reviewed by the mysterious 5280 Angel. I think I saw that guy in the audience, though it was hard to make him out behind the fake glasses, nose and moustache.
The audience got some play money, and got to “invest” in one or all of the five companies. My only complaint with the format was that they lined the investors up and you put the cash right in their hands. A little awkward.

I was surprised by my own reaction to the companies. If I read a story about lice, or even Genetically Modified food, I get itchy, queasy or otherwise squeamish. Two of the five were medical companies, and I thought both of them would be solid investments.

The panel of experts picked Livengood, which makes essentially a glorified cart for use in hospitals. The presenter was Dr. Livengood, I presume, and he was anything but polished, but he showed one slide of a patient in a hospital trying to take a walk surrounded by an IV pole, a walker, a nurse, and aid and a family member. He said something like, “Anyone who’s ever been in or visited a hospital has seen this scene many times.” Everyone in the audience nodded, in fact I think I saw the fake nose almost come off of the 5280 Angel guy. His contraption basically puts all the stuff that hangs on or near a bed in one place. They’ve had some customers, and those customers helped with the second version of the product, and now they just need money to build some more units and do some marketing. Great investment, I think.

The other medical one was Torii Medical, which had a great patch that basically makes a patch that holds any tube that gets stuck into your body much more securely and cleanly than tape, which hasn’t advanced much in 40 years. The presenter was the weakest, making the deadly sin of reading every word on every slide in the presentation. The product, however, was awesome. Just as with the other one, it fits in the category of medical advances where they are really needed. I know PET scans and all the new drugs are all super, but there seems to have been very little advance in the more mundane things like enabling a patient to take a walk or keeping an IV tube where it’s supposed to be.

The audience winner was Chaperon, which has built a tool that makes offshore coding slightly more secure. The concept is that an offshore coder would have to use this software when writing the code, and this software prevents a person from copying and pasting the code to steal it. I think this company is on to a serious problem in a big-picture way, especially as made clear in China Inc. Intellectual Property protection is a huge issue, and will be for a generation.

One of the others, Kerpoof, probably has a great chance to make money, but they are involved in something I would never put money in: figuring out new and clever ways to get advertising in front of 3- to 5-year olds. Any business plan that carves out any demographic and then tries to figure out how to get advertising in front of it is inherently foul to me, but doing it with pre-schoolers is especially opprobrious.
The other was Magic Home Entertainment, which makes a kind of a glorified iTunes interface for very high-end home audio systems. I like country music on AM radio, so I just don’t get it, but that probably says more about me than about that company.

Seeing the presentations was also an important reminder that anyone running a business should be able to make the business case for their business clearly and quickly at any time. It’s not just a mind-game; it’s being clear about goals, which is a crucial first step to reaching them.

OK, back to work!

Posted in Declarations, Fantasy Business League