A Seattle-based seed stage investment and technology development organization.
Appeal to the person on the opposite side of the table with PERSONAL INCENTIVE. Not reason. What’s good for their company is one thing. What’s good for the being is another thing entirely.
FYI. This is not the same thing as a bribe. It’s more about being sensitive to their own motivations.
Ok, actually Eric Enge did most of the work over on his blog by writing about the first 11. So, I’ll just link to him then 
But, I’d like to add one more to this list because I think its important if you are trying to compete effectively with other companies in your sector. And, who isn’t trying to do that? Any SEO firm that isn’t naturally curious what other companies in your space are doing from an SEO perspective AND doesn’t or isn’t willing to share that information with you is not a good SEO firm. Getting a snapshot of the competitive landscape looking through the SEO prism is the first thing a firm should do, in my opinion. If you don’t know who you are fighting against and how good they are then you are going into SEO battle alone.
I was sitting on the plane the other day next to a mid level marketing manager at Microsoft. This person was pretty proud of the fact that they read all the blogs to keep up with what is going on within the Seattle start-up community. I was given all manner of explanations as to why Redfin will never work and why Pluggd needs to add more differentiation to their product offering. As I listened, this conversation made me think about a broader phenomenon…
When you start companies, there will always be a lot of people who don’t want to see you succeed.
While they’ll rarely say it out loud, these will be former co-workers and other “pundits” who are secretly jealous by the very decision you’ve made. As I thought more about corporate America, I remembered what the game used to be like for me. 50% of your expended energy is invested on internal politics. The other 50% is spent trying to actually make a measurable and noticeable impact on anything. It seems funny to me now, but looking back I remembered all the actions and behaviors of most everyone. They spend a lot of time doing “work” and then spend a lot more time shopping around the results of their “work” to try to convince someone more important than them (e.g. upper management) how useful and important their work product is. They have to spend time and energy doing this hand waving because in reality, the work most people do within larger companies really isn’t that impactful to the overall business anyway.
My smartest of friends who work for large companies don’t kid themselves. They know that a lot of the trips they take and things they do are as much boondoggles as they are useful. Or, they know that they can’t really get done as much as they like but they are hamstrung by the big paycheck and nice perks. I can relate to that. It’s not an easy thing to walk away from and in most cases it isn’t a good idea to do so!
But the arm chair quarterbacks will be the ones who get under your skin. They are drawing paychecks from a company somebody else started. They have never raised money against their own ideas. The have never put themselves out for others to put under the microscope. They will never be need to be judged against their true abilities because their faults are hidden within the infrastructure of something much larger than they are. So, entrepreneurs I hope you pat yourselves on the back today. You live and die on how you do. That earns you the right to say whatever the hell you want about things because now you don’t have to appear politically correct in meetings so you’ll get that holiday bonus or that promotion. You are not perfect and the armchair quarterbacks will be sure and remind you of that fact. But you have courage in spades because what you do is too scary for most people to try.
How is this for revenue growth? The best way to finance a company? Revenue.
* 1999: Almost nothing
* 2000: $ 1.6 mm
* 2001: $ 8.6 mm
* 2002: $ 32 mm
* 2003: $ 70 mm
* 2004: $184 mm
* 2005: $370 mm
* 2006: $597 mm
* 2007: $840 mm
* 2008: Over $1 billion (goal)
http://www.ironmyers.com/
This CSS Development Collection Project is put together by Jake Myers and looks to be one of the more extensive CSS resource directories I’ve yet seen. Definitely worth a bookmark. You’ll use some of this stuff.
Thanks to TechnoSailor for doing this review of the new WordPress platform. Besides the obvious interface updates, you’ll notice a new and dramatically improved visual editor for making posts. The TinyMCE team has worked closely with WordPress on this release and it looks much better. You’ll also notice a new batch image uploader for those of us who like to add a lot of images to our posts.
This is not yet a public release but it looks to be a serious update of the best blogging platform on the planet.
LinkedIn, with help from BusinessWeek’s CapitalIQ, has added a company directory and research information to its business network. For now, it seems you can only get to this directory through Linkedin. You have to get to the directory through individual user profiles and the Linkedin blog explains more on this process. At the moment, there are 160,000 companies in the database. The Linkedin demo video does a decent job explaining how you would access and benefit from this new feature.
Linkedin has always been a great tool for recruiters and start-ups looking to find new staff. Being able to do more background information on the companies behind the individuals seems to be of obvious value.
You designers have long known about the Airtight Interactive photo viewer. It’s free. It’s flash. It’s easy to use. For those of you who haven’t used this code, go check it out!
Dropbox is super cool. Seriously. Need an easy way to share a file with someone? Just drag the file into your dropbox and get your URL. What if you make a change to the file later? No worries. The latest version of the file stays in synch. What if you need to recover a previously deleted file? No problem. What if you want to easily drag a whole folder of files or images at once? No problem.
Of all the filesharing systems I’ve seen, this is the best so far. And, over 10,000 others must have liked it too because that’s how many Diggs this thing has so far. Sure, you could always FTP files up to a webserver if you know how to do that. But, even that method doesn’t keep version changes of the same file up to date.
Sure, I admit that I’m not going to represent a scientific study as to what technology investors in the Bay Area are feeling right now but I am quite happy to share commentary from several VC’s I’ve communicated with over the last few weeks. At the moment, Imagekind is working on a Series B round. As a board member, I occasionally participate in these meetings either in terms of helping to set them up or simply to support the effort as (one of the) entrepreneurs behind the concept.
Based on my dialog with these investors, I have come to develop better understand how the downturn in the economy is affecting the overall tone here (I am currently writing from a Starbucks in San Mateo).
1. For whatever reason, the venture community responds and lags behind the overall economy by about 6-12 months.
2. Indeed, it is taking longer to raise money and valuations are generally negotiated lower now.
3. This is not the case for a select few start-ups that are known and understood to have competitive investor discussions.
4. Unknown start-ups with unknown management will have a hard time getting deals done this summer and should prepare accordingly.
5. For “consumer plays”, a premium is still placed on high numbers of unique visitors. Not necessarily early revenue.
6. VC’s seem to be “sticking to their knitting” more now. That is, a late stage VC would have been known to make more exceptions in their investment patterns during the prior two years in that they might have invested $2 million when their normal “sweet spot” investment size was $7-$10 million. You’ll see fewer of those exceptions over the next 12 months. Prioritize and schedule VC meetings that are most appropriate for your deal size.
7. For whatever reason, VC’s seem more willing to consider deals outside their traditional geographies now. Globalization taking hold? Seattle, India, China, Dubai. It matters less where the good deals are now. If you’re good and you have a good story you are less likely to hear things like “we really like you but you’re in Seattle and we’re in Los Angeles.” You’ll see California investors announcing more deals in India and anywhere else they can find a competitive advantage.
8. In spite of the economy, Bay Area VC’s still have a lot of money to put to work. They want to put it to work. But, they are more cautious than they were a year ago. The money is there if you’ve got a good investment opportunity. Thus, Seattle entrepreneurs should make investor pitches in this area a priority. Connecting the right firm for your deal is 50% of the work. Do not prioritize based on the biggest names, names you know, names you read on Techcrunch etc. Do your homework and there is plenty of money to be deployed here.
9. Close times are back to normal. That is, even really good deals will go through a slowed diligence process now. Imagekind got its first $2.6 million term sheet in about 14 days after the first phone call. There is a less frenzied tone in the air but certainly the tone is more energetic than what I sense in Seattle. Checkbooks are out but your spreadsheets had better be detailed because lots of hand waving is no longer in fashion.
10. Spending time in the Valley is highly recommended for Seattle companies that pertain to specific technology “micro-trends”. For example, there is a specific VC audience for certain companies that are catering to “minipreneurs”. That is, companies like Etsy and Imagekind who enable the “micro business person” to make a bit more money. There may not necessarily be a VC with these specific religions because there are just fewer VC’s in Seattle. Making those matches makes both the investor and the entrepreneur happy because both view it as a win-win of a personal nature.
11. Make no mistake. The economy has turned full blown grins into mere smiles down here. That might even be understating the mood by a good margin. Even so, VC’s don’t seem to believe that the tech economy has Reaper knocking at its door. For now anyway.
That’s all for now. Off to the next meeting.
By now you know about the fiasco at Bear Stearns right? How it got gobbled up for like 2% of its marketshare?
I noticed some email traffic going about within the Seattle start-up community last week regarding outsourced PBX phone systems that might be appropriate for start-ups. Having struggled with Asterisk ourselves at Imagekind for well over a year, I knew this discussion was going to be very valuable for someone. Here’s the summary of that thread from last week.
http://www.asterisk.org/
Generally too complicated to bother with.
http://www.accessline.com/
Comments about being unhappy with this service.
http://angel.com/
“Point and click interface for everything. Angel does everything…”
http://gotvmail.com
Generally good feedback.
http://ringcentral.com
“It does everything we need and it is very cost effective.”
http://www.switchvox.com/
Generally good feedback.
Ever wanted to find that perfect image on flickr? How about if you wanted to search by an image where the original had been placed in flickr while excluding the rest AND you wanted to search for images that could be used by you under Creative Commons? Also useful for finding licensable photos heh? It’s easiest with Compfight. Just hover over each image to see what is available and what the pixel dimensions are. Simple but very, very handy.
Mac power users no doubt already know about Skitch but I was turned onto it yesterday by my good friend Max Ciccotosto over at Wishpot. My usual process for pointing out bugs graphically or otherwise notating something I like about another site is to screenshot it, bring it into Photoshop and write all over the image. Skitch lets you do this SO much faster. You can scribble, jot, annotate and do anything else to an image in seconds. Much fewer steps to point out what you want others to see. Ideas can even be directly uploaded via FTP right from the tool. Talk about conveying ideas from one person to others in the most fluid way possible. Makes me wonder what other Mac apps I shouldn’t be living without!
Whew. By now most of the blog sphere will have been aware of this post by 37Signals which details how the firm is experimenting with a 4 day work week. The logic being that employee satisfaction is higher and people come back more refreshed after a nice long 3 day weekend.
Nearly simultaneously was a email thread going around on the organize@seattletechstartups.com mailing list on the very same subject. The discussion got heated. Some said that if you want a nice, relaxing work experience then you aren’t cut out for a start-up. Others maintained that this position is arrogant, unrealistic and dated. I haven’t seen a good email flame war in a while but I could easily understand both positions.
At Imagekind, my first developer was a very hard worker. She showed up promptly at 9am when most other devs preferred to get started around 10am. She worked all throughout the day and never left for lunch. She would also begin packing up around 5:30 pretty consistently. I knew that when she was in the office she got more done than anyone else and there was no question about it. From the very beginning, I had discussed that she could work from home every Thursday. Like all great devs, she had other employment options. Allowing her to work from home one day per week was a creative perk that we could offer as a fledgling start-up. There was a huge amount of mutual respect, admiration and trust between us and I never felt that she wasn’t giving 100% while she was home on Thursday. Her instant messenger would light up promptly at 9am each day.
There are different expectations for employees than there are for co-founders. I don’t expect employees to work the same amount of hours that I do. Frankly, I’m on email pretty much all the time and I work most weekends. But, employees are different. What I do expect is that employees are incredibly talented at what they do. And I expect that they are not disruptive in the office. They need to work well with others and I’ve made the mistake of hiring incredibly smart people would were also incredibly abrasive. It never works. I don’t really care if someone wants to work from 11am-7pm. Or 9am-5:30pm. It just doesn’t matter. Where it falls apart is when the situation is abused. In my experience though, it is possible to communicate up front that this freedom and flexibility is offered because you generally care about the well being and happiness of the people who come to work every day. I want them to be happy that they came to help us realize our dreams. I want them to feel appreciated. And I tell them that I appreciate them every day. I’ve found then when you structure your work environment around a sincere desire to make an employee truly happy about working with you then they will give so much more back to the organization. When it all comes together, there is no discussion about the work week because each is trying hard to make the other happy.
If someone went above and beyond to help us hit a milestone I’d ask them to work from home after lunch.
If someone wasn’t feeling well and I could see it I’d ask them if they wanted to leave a little early.
If someone was having a difficult personal struggle I’d tell them to work from home and just leave instant messenger on.
If someone was having a hard time solving a problem I’d take them to lunch.
All of these things probably seem obvious. But, in the end, we all felt that we worked hard enough each day and there wasn’t a need to ask someone to work harder.
Having said all of this, I admit that I made mistakes. The biggest mistake I made was that I subconsciously provided this kind of attention primarily to developers and I don’t believe that I extended the same level of courtesy to all the employees right down to the temporary folk who helped us on non-technical issues. It’s easy to show favoritism and not be aware of it. In retrospect, I would have treated everyone the same but I didn’t realize at the time how much preference devs were getting compared to others. It turned out others noticed before I did.
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Curious Office is both a seed stage investment firm and a software development company. We make early investments in the web sector and we choose to build our own companies at the same time. We have worked with many great technology entreprenuers over the last 15 years and we have accrued extensive experience ourselves working for or starting our own great software and web companies. Learn more about how Curious Office could possibly help your company grow to the next level.
