BeyondVC
NOVEMBER 26, 2004
It seems that SCO is making another attempt to hurt the open source movement by claiming that the GPL is unconstitutional and violates federal patent and copyright laws. While many are not concerned and call this a publicity stunt by SCO, the discussion of open source software licenses does remind me of a panel that I recently saw at the Goldman Sachs Software Retreat 2 weeks ago.
BeyondVC
SEPTEMBER 14, 2004
Board meetings can be a gigantic waste of time if not run appropriately. On the flipside, they can be a valuable source of input and guidance for a management team in the pursuit of maximizing shareholder value. While there are a number of different ways to approach and run a board meeting, I thought I would outline a few of my philosophies on them, and what I expect from my portfolio companies in terms of content. 1.
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BeyondVC
MAY 5, 2004
It has been awhile since my last post as I have been busy with board meetings. In addition, I met a number of interesting companies, a couple of which were service businesses in the process of transitioning their models to become product-driven software companies. It is a familiar formula to many out there. More often than not, the principals of a service business may have developed expertise and a network in a particular industry, developed a solution for a customer, and decided that they could
BeyondVC
APRIL 12, 2004
Lee Gomes from the Wall Street Journal wrote an interesting piece (sorry, not a free site) in his Portals Column about Project Avalanche which is essentially a software co-op for businesses to share their applications and code. Current members include Jostens, BestBuy, and Cargill. According to Lee, the Avalanche Project was started because the founders kept asking themselves the following questions: “Why were they writing such big checks to their software companies, but getting so little
Speaker: Nick Noreña, Innovation Coach and Advisor, Kromatic
Every startup and innovation project exists within an ecosystem that either helps or hurts that project. As innovation managers, we need to keep a pulse of that ecosystem and make sure we're helping those innovation projects we're managing every step of the way. In this webinar, Nick Noreña will walk through an Innovation Ecosystem Model that he and his team at Kromatic have developed to help investors, heads of product, teachers, and executives understand how they can best support innovation in
BeyondVC
MARCH 25, 2004
So while I was at PC Forum, my partner, Ned Carlson, sent me an email on the recent IPO filing of Seven Networks. Having talked to a number of bankers, we always thought that one needed $6-8mm of quarterly revenue, profitability for at least 1-2 quarters, and good visibility for the rest of the year in order to go public. It seems that the filing for Seven Networks goes against the grain.
BeyondVC
FEBRUARY 5, 2004
Fred Wilson has a great post about building a “customer-obsessed company” as opposed to a “technology-obsessed company.” This is good advice and reminds me of a number of companies built during the bubble period which were technology companies in search of a problem to solve. For early stage companies building their business, some of Fred’s advice includes investing “in the customer facing side of the business and in particular account management and customer
Start Up Roar brings together the best content for start up professionals from the widest variety of industry thought leaders.
BeyondVC
NOVEMBER 12, 2004
It has been awhile since my last post as I have been busy with a number of board meetings. It is so hard to find time. Anyway, one thought I wanted to share with you is a discussion we had in one of the meetings about the balance between closing large deals and adding new features. More often than not, you will hear a sales person complain about their product and tell corporate that if they had these 5 features, they could sell more.
BeyondVC
OCTOBER 13, 2004
I was speaking with a friend of mine today who mentioned that his term sheet for his Series A round fell through. Things looked great for the last 6 weeks and then the deal process went into a stall regarding intellectual property rights. To make a long story short, one of the co-founders of the company built the company’s software in his spare time.
BeyondVC
APRIL 1, 2004
I was with a banker today talking about the influx of new IPO filings and the end result of our discussion was the following: 1. Filing does not mean anything, the companies may never go public 2. Performance is key-revenue visibility is of utmost importance because the street does not forgive. Case in point-if you miss your numbers within the first two quarters after you go public, forget about it.
BeyondVC
JUNE 24, 2004
Like any active, early stage venture investor, I have spent a fair amount of time helping my portfolio companies build a management team. And like any venture investor, I wish I could boil hiring down to a more scientific method to make sure that each person we bring on to a company is better than the next. However, that does not always happen. The one constant in hiring, however, is the “A-Player Domino Effect” which basically says that when you hire an A-Player, they bring lots of
BeyondVC
APRIL 13, 2004
I have written about linux on the desktop in the past ( here and here ). Today, my partners and I installed the latest version of Xandros 2.0, and I have to admit we were blown away. It installed in about 10-15 minutes with a couple clicks of the mouse, and we had a full working version of a linux desktop which looked and felt like a Windows machine.
BeyondVC
DECEMBER 20, 2004
During the boom, many VCs funded companies and created great exits within 12-24 months of funding. Before that time, the standard rule of thumb was that it took about 5-6 years for a company to reach maturity, profitability, and potentially become an IPO candidate. We did our own analysis of venture-backed software IPOs a couple of years ago (based on SEC filings, etc.) using pre-bubble data and this is what we found.
BeyondVC
DECEMBER 16, 2004
A number of my readers alerted me to the fact that Fast Company has a survey on the best VC blogs. Considering that VCs can be quite competitive and my cohorts Brad and Jeff are already stuffing the ballot box, please take a moment and cast your vote for me. All kidding aside, since this is not a zero-sum game and if you haven’t already, I suggest getting to know some of the other VC blogs that I enjoy reading.
BeyondVC
DECEMBER 15, 2004
I was catching up on my Barron’s this week and a quote from Ajay Kapur of Citigroup caught my attention. When discussing his macro investment themes Ajay said, "The world is driven by Asian exporters and U.S. consumers. In the future, it will be Asian consumers and U.S. exporters." Given that perspective, it is no surprise that VCs have been pouring dollars into consumer technology plays over the last 18 months in addition to investing in China and India to tap into their consumer
BeyondVC
DECEMBER 8, 2004
I was recently advising a friend of mine who wanted to expand his team and hire some senior executives, and it occured to me that others could benefit from some of my thoughts on recruiting. As you know, hiring is a critical component in the success of any company. People and their ability to execute are what separates the winners from the losers in any industry.
BeyondVC
DECEMBER 3, 2004
In the past, I have written about a number of first generation NYC entrepreneurs coming out of the woodwork to launch new ideas. Sure, the market may not be great right now but in my opinion it is the best time to build a business. As an entrepreneur you have time to develop your product, refine and test it, and get it ready for when the market turns.
BeyondVC
NOVEMBER 19, 2004
Early stage companies have to be nimble and disciplined when creating and releasing product. One of the important decisions a startup can make is how it chooses to manage its product releases. In a software company a product release affects everyone. A mistimed release can severely impact sales, cash flow, and the company. We had a thorough discussion in a board meeting this week on this very topic.
BeyondVC
NOVEMBER 4, 2004
Adam Bosworth has an interesting post on the evolution of software and why software delivered as a service will be the business model of the future. As you know, I have always been interested in this trend since my first post in October 2003 and since I invested in a number of companies in 1998 and 1999 like LivePerson and Expertcity (GoToMyPC) that subscribed to the ASP business model.
BeyondVC
OCTOBER 27, 2004
The numbers are coming out, and it is clear we are moving to a low growth environment for corporate IT spending in terms of dollars spent. Companies spent too much in the 90s and are being cautious about how they spend their hard-earned cash. Total cash and savings for companies in the S&P 500 have doubled since 1999 and is equal to half a trillion dollars which means companies have added almost 300 billion dollars to their balance sheet in the last 5 years.
BeyondVC
OCTOBER 20, 2004
Here is an interesting article from Business Week about why Microsoft is not so scary anymore. While I do not necessarily buy the argument that a company with billions of dollars of cash on its balance sheet is not scary, the article does raise some interesting questions about Microsoft’s growth, particularly on the enterprise side. A quote from Merrill Lynch software analyst, Jason Maynard, sums it up: “Microsoft still has the critical mass and the franchise of Windows and Office, b
BeyondVC
OCTOBER 6, 2004
Unfortunately I could not make it to the west coast for the Vortex or Web 2.0 conferences. However, I have been following Vortex via Jeff Nolan and Web 2.0 through a variety of bloggers. As I read through Jeff Nolan’s notes on the enterprise and thoughts from the gorillas in the market, Cisco, Microsoft, Oracle, HP, etc., it is clear that they are all pointed in the same direction, and the vendors are aggressively pushing towards a service-oriented world where you have management software
BeyondVC
OCTOBER 1, 2004
There has been lots of discussion about the web as the new platform so none of what I am saying is new. However, I recently came across Adam Bosworth’s take on this which is quite interesting given his experience at Microsoft, BEA, and now Google. The platform of this decade isn’t going to be around controlling hardware resources and rich UI.
BeyondVC
SEPTEMBER 29, 2004
I had the opportunity to spend a few hours today at an Intel Capital event for their portfolio companies and VC friends. While a great way to network with fellow investors and meet new companies, I particularly enjoyed a talk given by Chris Thomas, Intel’s EStrategist, on the future of software in the enterprise. While none of the ideas were new, I liked how he laid out the major themes in computing and software in a well-thought out presentation.
BeyondVC
SEPTEMBER 28, 2004
Jeff Nolan has a comprehensive post on choosing your VC. I totally agree with Jeff’s view that not only should entrepreneurs do their diligence when choosing a VC to invest in their company, but VCs should also do reference checks on their new partners. This includes understanding potential board dynamics and making sure investor interests are aligned.
BeyondVC
SEPTEMBER 16, 2004
During the Internet boom, all eyes were on the United States as we were the first to leverage this new medium and create some amazing companies and uses of the Internet from ecommerce to search to online dating. Many of these companies did not know how they were going to make money except that they would figure it out. Over time the business models evolved, some became profitable and some simply went away.
BeyondVC
SEPTEMBER 9, 2004
Whether you know it or not, this seems to be the way that alot of early stage companies make strategic and tactical decisions. People run around the halls and manage by crisis, moving from one deal or issue to the next without any overarching goals and process in place. Solving this not only requires better planning but also staying disciplined, holding you and your team accountable, and executing on those goals.
BeyondVC
SEPTEMBER 8, 2004
Normally I do not read too much into press releases on industry hires but I found this one interesting on many levels. Intel, a tremendous brand in its own right, hired a marketing executive from Samsung, a Korean company. Most people assume that the US’ competitive advantage over the rest of the world lies in design, innovation, and branding.
BeyondVC
AUGUST 26, 2004
Jeff Nolan has an interesting post about how a US General views blogs as an excellent source for unfiltered information. Jeff goes on to postulate that CEOs could also get unbiased information from their field as well. In the private sector it’s only a matter of time before CEO’s, at least the better ones, start figuring out that the best way to get the straight scoop on a topic is to drill down to the field by reading the blogs that exist within the company.
BeyondVC
AUGUST 25, 2004
I recently had a board meeting for one of my portfolio companies and was upset because during the sales pipeline review we only heard great things about the pipeline, new closed deals, and the possibility of beating our quarter yet again. What bothered me, however, was that we did not spend enough time discussing the big losses or missed opportunities.
BeyondVC
AUGUST 16, 2004
Here is another example of why commoditization is not killing innovation. In fact, it can and has given a number of companies a leg up in terms of developing and deploying new products in record time and at low costs. Using so-called commodity software and hardware actually does not kill innovation but speeds it up. For example, Metapa , one of my portfolio companies, has begun shipping a software product (Metapa clustered database) that enables customers to deploy terabyte scale data warehouses
BeyondVC
AUGUST 6, 2004
We are truly living in a global world these days. Many startups I meet with today are either taking advantage of offshore development or have pushed up plans to expand sales internationally. Given the broader scope of this trend, I have changed the category name Offshore Resources to represent a broader theme, Globalization. While taking advantage of a global economy is a great idea, it certainly can be disastrous for some companies.
BeyondVC
AUGUST 4, 2004
One of the recurring themes of dealing with VCs and boards is that we do not like surprises. In addition, tell us the facts, and if there are any negative surprises give us action steps on how you are going to remedy the situation. I have written about the VC/Entrepreneur relationship before and due to its importance will continue to write about it in this blog.
BeyondVC
JULY 19, 2004
If you ever wondered what it takes for a startup to succeed, please read the email below sent from the CEO of one of our portfolio companies to his whole staff. Sure, startups don’t have the cash, the people, the distribution channel, and brand to compete with the established players but passion, drive, and an insanely great product can take you a long way.
BeyondVC
JULY 15, 2004
If I were a startup, one great and cheap way to build buzz and excitement is through the blog community. I call this “influencing the influencers.” Think about it – many of the more well known bloggers are also well known tech journalists, industry pundits, VCs, and technology executives. Forget about using the traditional PR route – if you can get these influencers to write about you on their highly targeted blogs, others will hear about it, write about it, and generate
BeyondVC
JULY 14, 2004
Ok, now for some boring accounting stuff. Red Hat (RHAT) recently restated its financials. Its auditor, PWC, suggested that it change its revenue recognition policy. According to a CBS Marketwatch article : Under the accounting method used in the past, the company would recognize a full month’s revenue from a subscription agreement, even if a deal was sealed in the middle of the month, for example.
BeyondVC
JULY 10, 2004
Another day, another politician or high profile executive launches a blog. This time it is FCC Chairman Michael Powell and Sun’s Jonathan Schwartz. According to Michael Powell, he decided to blog because he wants to interact direcly with his constituency, creating a dialogue and urging Silicon Valley to get involved. He goes on to say: One reason I am participating in AlwaysOn Network’s blog is to hear from the tech community directly and to try to get beyond the traditional inside t
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