I believe they could not have been more wrong!

I don’t know their situation or how desperate they are, but that’s not the point. What I do know is that any company looking for investment needs to be as selective in their approach as the most hard-nosed VC. I accept that it’s a tough market at the moment but the rules have not changed – doing a deal with the “wrong” investment partner will end in tears……every time!

I believe that when you look for investment you need to have clear selection criteria, make sure you know the people sitting opposite you, understand why they are investing in you and be VERY conscious that there are two sides to the discussion (negotiation). If not, this early stage can very easily develop into an “interview” with the person holding the cash in total control – it’s then too easy to be under pressure and take the first offer you get. Having a clear strategy of the “type” of investment you want, asking detailed and direct questions and not being afraid to take time to consider your options (there are always options) are an essential part of the negotiation process. Not only will you know each other’s expectations and avoid future problems, but you will also improve your business case by clearly demonstrating you know what your business needs to be successful.

So what is “good” money?…

I was once told you should look for investors that are “Patient” and “Passionate” and I have added “Proven” and “Participatory” to come up with “The 4 P’s of an Ideal Investor”.

1. Patient - Understanding each other’s expectations is vital – you need to set out your best realistic estimate of time to market and revenue; claiming or agreeing to shorter timelines or unrealistic returns is short-sighted and setting yourself up for failure

2. Passionate - Empathy will make the road ahead far easier – if you can find people who feel passionately about your opportunity and its market, goals and potential is a real bonus.

3. Participatory – More than just a financial relationship – you are asking for investment but a good investor can offer so much more. Access to new markets, partners, skills and general support can be worth almost as much as the cash!. As a side note, if you are paying directors’ fees or “management” charges as part of the investment package,  then they MUST contribute to the day to day activity and add value – apply the same rules to them as to ANY expenditure.

4. Proven – Ideally don’t be the first – in your market space or type of business. Research your potential investors; speak to other companies they work with – find out what they are really like to work with!

As you see I believe the relationship must be about more than just the cash and should include an understanding, passion and contribution. These combined with shared expectations and good communication can only increase the chances of success….for EVERYONE!

I acknowledge this is not a exact science and not every company wants the characteristics outlined above, BUT you should at least ask yourself the questions and be prepared for the process.

Disagree? What do you feel makes an ideal investor?

As we made our way into the upper tier of GM place and settled down I was more looking forward to Snow Patrol than the main act. My fear was confirmed by the crowd – we appeared to have arrived at a cross between a NKOTB, Beyonce and American Idol event. The audience was comprised of groups of young girls (complete with short skirts and accompanying parents), couples (dressed for a date) and groups of friends who clearly don’t go to a lot of live events (but no doubt like the singles!)

Down went the lights and the screaming started – I am not sure Snow Patrol will have played many times in front of this type of crowd but they did a great job of running though a strong set without loosing focus and I must make sure I see them in a smaller venue when they return. The only down side was their continual arse licking statements…..” only 30 minutes until Coldplay”….”thanks to the fantastic Coldplay for inviting us” etc etc….

After a short break the “main event” started and I must confess despite all my misgivings we were treated to a good show. Rock music its not, but as pop bands go they were great. They ran though the full repertoire of hits complemented by all the effects and gimmicks would would expect. We had balloons (a la Flamming Lips), an “intimate” session close to the fans (U2) and Chris Martin running around like a demented Roger Daltrey on steroids….(I was tired just watching him!).

I confess I wont be rushing back to the next event but everyone appeared to enjoy it and I even wandered home humming a few tunes…..

Ive since checked and Coldplay are listed in Wikipedia as “alternative rock” which puts them in the same category as Oasis, Arcade Fire, The Libertines and The Arctic Monkeys! Although this is wrong they do provide good value and its difficult to say something bad about someone who appears to care about some important things and can write a catchy tune.

Roll on Jack White…..

I thought for a moment and then said “focus”.

My point was, that although there are many elements to any successful business (start up or otherwise), in the “chaos” that often typifies an early stage business, the ability to focus on the right things is key.

Following the meeting I got to thinking about the question in a wider sense and decided to set out what I feel makes for a successful start up and how to I try to spot them.

Over the past 15 years I have been involved in several start ups and emerging companies; in a hands-on capacity, as an advisor and as an investor – some have been successful and others less so….but why?

I believe success has 3 key components:
A. Core – the “right” product/service and business model
B. Talent – with the “right” skills and attitude
C. Support – access to services, skills and methodologies.

In short – a perfect scenario would be a great idea/model with passionate and skilled people who are open to input and support.

Although this sounds “idealistic” I have seen it happen a number of times and it’s great fun to be involved. The reverse of this is the frustration of having a strong “core” but failing to see (refusing to accept) what is needed to succeed, focusing on the wrong things and then missing the opportunity!

To expand a little further

A. The Core
When I look at an opportunity I always start with the “core” questions – is there a demand for what being proposed and does the business model stack

1. Product/service - clearly demonstrated customer need (critical is nice!); total focus on the customer needs; don’t “over engineer”; move to actual users/customers as soon as possible – if not sooner!; flexible to change if demand exists
2. Business model - knowing the cost of development and incremental delivery/roll out – particularly in non software situations; understanding the real cost of acquisition; demand at a price that stacks up against these cost elements; realistic and sustainable market channels; potential for significant growth

It’s worth saying that often if (1) is “workable” then I am more than willing to help defining (2) further – something that’s vital for expanded/second round funding.

B. Talent – the “right” people
To me this is reasonably straightforward and is all about leadership. I have always found that people in successful start ups:

• Believe it’s a mission – not a career
• Focus on things they can do now -  not just the dream
• Are obsessed with customers - and what they want/need
• Are driven by excellence
• Communicate – good and bad news
• Contribute – with clear roles for everyone
• Work with integrity and respect
• Do stuff
• Enjoy it
• Know their limits - and actively seek help to fill the gaps

C. Support
I group these areas together because, although they are all critical, I classify them (although not all agree!) as “commodities” which can be out-sourced or supplemented by external resources.

• Finance – from bookkeeping through to access to strategic guidance (CFO level) – separate skills!
• Funding - from initial seed through to identifying sources for later rounds and securing
• Grants – identifying, securing and complying with the terms
• Marketing – full range of services from supporting the business growth and sales through to investor work
• Legal – from business terms and employee contracts to structure/equity and IP
• Environment - having a location/”environment” where people want to be and work – this is often overlooked and is not just about spending money

Every start up has a different collection of internal skills; however when certain skills are lacking, it is VITAL to identify this and react accordingly. A further complication for many start ups is that although they need a wide range of skills and access at different levels of seniority, they don’t need them full time. The reaction from some is to try to handle everything internally which not only causes a loss of focus, BUT can also result in dire consequences. I recently experienced a situation where, over a 6 month period, the core team met regularly and frequently with their investors, completed numerous grant reports and make hundreds of product changes (they even moved offices!) – but NEVER met with a customer or secured revenue!…..you can guess the outcome!

This is why I strongly believe that the support of an incubator can put these critical pieces in place without losing focus on (or taking resources from) the core opportunity. An incubator can provide access to advisors and support services that make the difference between success and failure, between achievement and frustration.

So these are my thoughts  on what makes a successful start up!

What have I missed? What do you think makes the difference?

• I switched last year from a lifetime of Windows to Mac:)
• I work on a number of simultaneous projects with multiple clients
• I combine remote working with a lot of travel.

So in no particular order my thoughts and observations….

1. Email
I was a “disciple” of Outlook and ran my life though it (email/tasks/appointments….driven by categories!) After moving to Mac last year I tried Apple Mail and Entourage before I switched to GMail. Although it’s not as functional in all areas, by using it in combination with some Flock extensions, the apps below and IMAP,  I’ve now almost totally moved ‘online”  (iPhone client!)
Cost - now free

2. Calendar
After a few months with iCal (great) I then moved to Google online which works perfectly with my iPhone and other apps.
Cost - free

3. Tasks
I used Omni Focus for a while but couldn’t really get used to it so I tried the Google option before settling on rememberthemilk.com, an online app that works great and has an iPhone option. For project/client tasks I also use the built in functionality of Basecamp and Salesforce – this is an area I am still not 100pct happy with and still searching for the “holy grail” that can combine them all and share data!
Cost - free

4. Contacts
I’ve always struggled to have one system – to combine personal and work – and for several years used Outlook. When I moved my last company to Salesforce I took advantage of the great functionality for all my personal contacts as well. Now I am independent again I have moved to HighRise online which is simpler, cheaper and ideal for my needs.
Cost - options from 24 usd per month – Highrise

5. Blogging
After using BlogJet for a number of years, last summer I moved to ecto on the Mac. However I recently started using the very easy inbuilt posting tool on my browser – Flock
Cost – free

6. Project Management
Long time user of MS Project and still have to use when clients require, but I am a huge fan of Basecamp which is a simple and very flexible online application. I am currently experimenting with a new service – Goalkeeper.
Cost - options from 24 usd per month – BaseCamp

7. Relationship Management (CRM)
At various companies I’ve used a combination of ACT, Maximizer, MS and bespoke internal systems. These have all but been replaced by services like SugarCRM and Salesforce and the flexibility they offer. At a simpler level I use Highrise which is another proven service from 37 Signals.
Cost - options from 24 usd per month Highrise

8. Syncing
I know there are lots of free/cheaper options around but the effortless reliability of MobileMe has got my vote! I was recently introduced to DropBox and I still evaluating it.
Cost - 99 usd per year

9. Back Up
There are numerous options here and I’ve tried several! Currently using a combination of MobileMe, IDrive AND a Time Machine – very convenient, multiple options and works seamlessly.
Cost – 4.95 usd per month + Time Machine purchase:(

10. RSS
Used Newsgator/FeedDemon for a few years before moving to NetNewsWire (both very good) but switched to Google Reader about a month ago and this works great and links with my Iphone!
Cost – free

11. Notes/Researching
Confess I did miss OneNote when I switched to Mac, but recently started using Evernote which is both on my desktop and online – works great and ideal for multiple projects/tagging.
Cost – free

12. Presentations
Still working on PP but just started experimenting with the new Adobe online system which has some real potential. I KNOW….everyone tells me I HAVE to switch to Keynote!
Cost - MS office

13. Financial
I still manage all business and personal maters through desktop applications (Sage/Quickbooks) – still looking for an online option ….perhaps security is still in my mind?
Cost - 100 usd Quickbooks version 2 years ago

14. Spreadsheets
I get to see, build and work with a LOT of business models in Excel. Many require complex modeling, multiple workbooks and database linkages so I guess I consider myself a fairly advanced user. I’ve looked at a few online options but nothing comes close to the functions I use offline – so far…..
Cost - MS office

15. Word Processing
After years on MS Word I guess I am still tied to it! I am currently “playing” with Google Docs but not finding it sophisticated enough for the client reports and presentations I often need to prepare.
Cost - MS office

16. Image work
I am a long time Photoshop user and although I’ve found a few online options for simple image work I am still “hooked” to PS for graphical work, mainly due to functionality and speed – but the options are getting better all the time!
Cost - Creative Suite…I would rather not think about it!

17. Music
Still firmly fixed with my offline “solution” of iTunes. I’ve experimented with a few online options but with over 40,000 tracks I need a lot of space!
Cost – free

When thinking about this I came across an interesting observation – my newest passions both require desktop/device applications! I could certainly not survive Twitter using only a web client and can you imagine an iPhone only using the browser and no apps!

I wonder if, in another year or two, I will have no desktop software other than a browser?

Is this the same for you? What do you use? I would welcome suggestions for areas I’ve missed or better solutions/applications.

This got me thinking about how my use of software has moved from the desktop to the web over the past few years.

This has not been a conscious or deliberate change and I’ve been analysing what has driven this:

1. Development Technologies - have improved to allow web applications to be created more quickly and with more functionality and usability
2. Infrastructure – lower costs  have made deployment environments with great reliability possible
3. Cost – reduced cost of development and deployment has resulted in low (free!) cost online applications
4. Mobility – my work has required access to information, data and applications wherever I am, using multiple devices
5. Confidence – I have more “trust” in the security and longevity of providers
6. Accessibility – the proliferation of “good” web access at home, work and roaming WiFi has made access almost a given
7. Risk reduction – whether it be data backup or replacement applications I have a combination of simple “standby” options that will keep me operational whatever happens.

Although there are few areas where I still need my powerful notebook/desktop I wonder how long it will be before I move to the latest generation of Netbooks and desktop applications are a thing of the past?….

Are you the same? What issues stop you or are you already a web based Netbook worker?

It’s a collection of 52 “Rules of Thumb” – they are challenging, practical, thought provoking and often amusing!

A few to think about…

#10 A Good Question Beats a Good Answer

#16 Facts Are Facts; Stories Are How We Learn

#23 Keep Two Lists: What Gets You Up in the Morning? What Keeps You Up at Night?

#45 Failure Isn’t Failing. Failure Is Failing to Try

#52 Stay Alert! There Are Teachers Everywhere

Go read, its wonderful!

Be passionate, never stop learning and always aim to enjoy it

I find everything else is a lot easier when I do this.

Passion – if you are going to do anything, have some feeling/passion about it otherwise you can never achieve what you are capable of, or give the task/project what it deserves. I don’t understand why people approach things with anything less than 100 per cent effort and commitment. It’s fine to question what you are doing or why, but then move forward with passion! You are often judged by how well you deal with the less inspiring things and I can guarantee you will do a better job and time will fly if you inject a little passion.

Learning – I have always enjoyed learning new things and never pass up the chance to add to my knowledge. When I make errors or things go wrong I always try to find out why and learn from it. I am equally inspired by new technology as I am by discovering an area of history I didn’t know about – I guess I am just lucky to have that kind of mind.

Enjoy it – why not?…..it’s not about taking things lightly or not caring.  It’s about a state of mind…..

If you can’t follow this rule, then go and find something else to do….life is certainly short enough already

“The one thing you need to know about sustained individual success: Discover what you don’t like doing and stop doing it.”
Marcus Buckingham, The One Thing You Need to Know

It argues that design is:

• Vital and must be approached as a process not just an event
• About the complete user experience, physically and emotionally and is not easy to archive -if you don’t connect emotionally then it will never be great design!

It’s full of good examples and is well worth a read.

This was the 4th time I’ve seen them live (plus all the albums) and the largest venue. The other times were in smaller “club” style places and I am sure the larger Commodore space didn’t help the atmosphere, which was pretty subdued – even for Vancouver. CWK always draw a very mixed audience for a style that often defies simple definition, and tonight was no different – I went from feeling very old to seeing people of my parents’ age!

I am a huge fan and tonight was no disappointment with a great combination of tracks all delivered with the passion and intensity only they can create. I’ve now taken 4 different people to see them and each time I am asked “what kind of music is it?”. I struggle to explain and on each occasion my friends leave saying things like “that was really different” or “I quite enjoyed that”!

I will keep spreading the word and if you ever get the chance, go see them live….you will not be disappointed..

White Lies and Friendly Fires, who are both achieving great things in the UK played in front of a passionate audience at Richards. I mainly went to see The Lies and they were up first just before 10 and starting with “Farewell to the Fairground” and went on to deliver an amazing and powerful set – despite a short delay! Friendly Fires followed about 11 with “Lovesick” before running through a non-stop electrifying set which also included “Jump In The Pool” and “Skeleton Boy” – most of it was new to me but I am certainly going to get the album now!

It’s good to see the audience so into the music for “relatively” new bands to Vancouver and the atmosphere was fantastic – not always the case with local crowds!

I am sure when these bands return to BC it will be in larger venues and I hope they maintain the vibe.

Check out the review at Killahbeez for a full set list and some great pics