Counter Cliche: Ready, Set, Exit Fred’s VC Cliche of the week is the about the Quick Flip. My counter to that is Ready, Set, Exit (image from Google Images). Most quick flips involve a huge element of luck. For every quick flip out there, there are dozens of companies that thought they’d be quick flips and ended up crashing and burning instead. Back in 1999, when we started Return Path, another Internet entrepreneur I knew loved the idea so much that he told me to start writing the book then, because I would be able to sell the for $100 million before we even had a product in the market. He said the title of the book would be Ready,…
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Entrepreneurship
Dumb Money
Dumb Money I don’t have a counter cliche to Fred’s two-for-one this week on Passing the Hat and Ponying Up, but I’ll counter with a different, somewhat related Fred cliche that I was reminded of today when reading Paul Graham’s essay entitled A Unified Theory of VC Suckage (form your own opinions of it, but it’s nothing if not thorough and experience-based). There’s nothing worse than dumb money backing a dumb idea or management team. The dumb idea or team can destroy an emerging sector pretty quickly, and the dumb VC behind the deal will just keep ponying up. For the record, the converse is also true — there’s nothing better than smart money behind a great idea and solid…
Today’s Wheel: Parsley
Today’s Wheel: Parsley Spiritually akin to my recent posting As Simple As The Wheel is Seth Godin’s posting today about Parsley, and why we don’t necessarily eat it off our plate but notice when it’s not there.
Developer User Guide?
Developer User Guide? Tom Evslin wrote a two-part series this week called “Managing Programming for CEOs” (links here for Part I and Part II). The first is pretty funny, and the second has some good thoughts in it, especially around milestone creation. But if Tom’s had the experice he relays in Part I in real-life over and over, I have a suggestion for him: get a great head of development he can trust, and work closely with him or her over the years to build a relationship of mutual trust so those issues are no different than they are with functional managers of other departments. We are fortunate enough at Return Path to have two such individuals in Andy Sautins…
Counter Cliche: As Simple As the Wheel
Counter Cliche: As Simple As the Wheel Fred’s VC cliche of the week this week is about the analog analog. It builds on one of Brad’s great concepts which he blogged about here. The concept is that figuring out how a digital idea mirrors an offline idea is a better way of handicapping future success of a venture than understanding pure technology analogs. I tend to agree with Fred, that it’s one useful lens with which to evaluate a new idea, but not the only one. So my counter cliche for the week is to look for something As Simple As the Wheel. At Return Path, by the way, nearly every business we’re in has a clear analog analog (Email…
A New VC in Town…Sort of
A New VC in Town…Sort of My friend and Board member Fred Wilson just announced last week the formation of his new VC firm, Union Square Ventures, along with his partner Brad Burnham. Brad Feld beat me to the “way to go” posting, so while I chime in with my congratulations to Fred and Brad and assert to the rest of the VC/tech blogging world that this firm will succeed famously, I thought I’d comment on two other aspects of Union Square Ventures’ formation. First, NYC has long been a haven for later stage private equity and buy-outs, and there’s a big need in the NYC area (even the DC-Boston corridor more broadly) for top tier early stage venture capital…
VC Wisdom du Jour
VC Wisdom du Jour Two good ones today: 1. Brad on what makes a great Board meeting (hint: it’s not going through the materials you send out ahead of time). 2. Jeff Nolan/Dispatches on 10 questions to ask a VC. Remember, when you’re raising money, you must do active due diligence on your prospective investors, not just the other way around. These questions are a good guide.
Ratcheting Up Is Hard To Do (or Boiling the Frog, Part II)
Ratcheting Up Is Hard To Do (or Boiling the Frog, Part II) I’ve had to ratchet down business several times over the years at Return Path. Times were tough, revenues weren’t coming as fast as promised, my investors and I were growing weary, the dot com crash, etc. etc. We had layoffs, consolidated jobs, cut salaries multiple times, made people wear 8 hats to get the job done. It’s an awful process to go through. In the last year or so, business has finally started going much better. We’ve been fortunate in many ways that we’re still around, with products that work really well, with a good customer base, and with good and patient investors and employees, as the business…
Who Wants to Get Hit by a Bus, Anyway?
Who Wants to Get Hit by a Bus, Anyway? Fred had an accurate if somewhat morbid posting today about succession planning, one of the many higher-order HR tasks that small entrepreneurial companies are particularly bad at. He’s completely right — for one example in our industry, you only have to look back about 9 months or so to Phil Goldman’s shocking death to see the impact it had on Mailblocks. I’ll have to post on succession planning in a startup in more detail sometime soon.
Boiling the Frog
Boiling the Frog We boiled the frog recently at Return Path. What the heck does this mean? There was an old story, I’ve since been told apocryphal, we told a lot back when I was a management consultant trying to work on change management projects. It was basically that: If you throw a frog into a pot of boiling water, it will leap right back out. But if you put a frog in a pot of water on the stove and then heat it up to boiling, you’ll boil the frog because it never quite realized that it’s being cooked until its muscles and brain are slightly too cooked to jump out. How have we boiled the frog? Two ways…
Rejected by the Body
Rejected by the Body My most recent posting ("Sometimes, There Is No Lesson To Be Learned") about a strange hiring incident at Return Path has so far generated 5 comments — a whopper for my blog. You can read them here if you want. They’re a little bit all over the map, but they did remind me of something I frequently tell senior people who I am interviewing to join the company: Hiring a new senior person into an organization is like doing an organ transplant. Sometimes, the body just rejects the organ, but at least you find out pretty quickly. At least we found out relative quickly with this one, although it was more like the organ rejecting the…