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A Grandmother’s Advice for Startups: You Never Know Unless You Ask

By Life

Originally posted on the SoftLayer Blog on April 17, 2015.

Today my grandmother turns 95. She’s in amazing shape for someone who’s nearly a century old. She drives herself around, does her own grocery shopping, and still goes to the beauty parlor every other week to get her hair set.

Growing up less than a mile from her and my granddad, we spent a lot of time with them over the years. Of all of the support, comfort, and wisdom they imparted to me over that time, one piece of advice from my grandmother has stood the test of time. No matter where I was in the world, or what I was doing, it has been relevant and helpful. That advice is:

You never know ‘til you ask.

Simple and powerful, it has guided me throughout my life. Here are some ways you can put this to work for you.

Ask for the Introduction
Whether you’re fundraising, hiring, selling, or just looking for feedback, you need to expand your network to reach the right people. The best way to do this is through strategic introductions. In theCatalyst program, making connections is part of our offering to companies. Introductions are such a regular part of my work in the startup community. In my experience, people want to help other people, so as long as you’re not taking advantage of it, ask for introductions. You’re likely to get a nice warm introduction, which can lead to a meeting.

Ask for the Meeting
Now that you have that introduction, ask for a meeting with a purpose in mind. Even if you don’t have an introduction, many people in the startup world are approachable with a cold email.

Guy Kawasaki, former chief evangelist for Apple, and author of 13 books including The Art of the Start 2.0, wrote a fantastic post, “The Effective Emailer,” on how to craft that all-important message with your ask.

Another great take on the email ask is from venture capitalist Brad Feld, “If You Want a Response, Ask Specific Questions.” This post offers advice on how not to approach someone. The title of the post says it all, if you want a response, ask a specific question.

Ask for the Sale
Many startup founders don’t have sales experience and so often miss this incredibly simple, yet incredibly important part of sales: asking for the sale. Even in mass-market B2C businesses, you’ll be surprised how easy and effective it is to ask people to sign up. Your first sales will be high-touch and likely require a big time investment from your team. But all of that work will go to waste if you don’t say, “Will you sign up to be our customer?” And if the answer is a no, then ask, “What are the next steps for working with you?”

Empower Yourself
It’s empowering to ask for something that you want. This is the heart of my grandmother’s advice. She is and has always been an empowered woman. I believe a big part of that came from not being afraid to ask for what she wanted. As long as you’re polite and respectful in your approach, step up and ask.

The opposite of this is to meekly watch the world go by. If you do not ask, it will sweep you away on other people’s directions. This is the path to failure as an entrepreneur.

The way to empower yourself in this world starts with asking for what you want. Whether it’s something as simple as asking for a special order at a restaurant or as big as asking for an investment, make that ask. After all, you’ll never know unless you ask.

Startups: Always Be Hiring

By Everything

Originally posted on the SoftLayer Blog on March 20. 2015.

In late 2014, I was at a Denver job fair promoting an event I was organizing, NewCo Boulder. All the usual suspects of the Colorado tech community were there; companies ranging in size from 50 to 500 employees. It’s a challenge to stand out from the crowd when vying for the best talent in this competitive job market, so the companies had pop-up banners, posters, swag of every kind on the table, and swarms of teams clad in company t-shirts to talk to everyone who walked by.

Nestled amid the dizzying display of logos was MediaNest, a three-person, pre-funding startup in the Catalyst program, at the time they were in the Boomtown Boulder fall 2014 cohort. What the heck was a scrappy startup doing among the top Colorado tech companies? In a word: hiring.

MediaNest was there to hire for three roles: front end developer, back end developer, and sales representative. They were there to double the size of their team … when they had the money. In the war for talent, they started early and were doing it right.

I’ve often heard VCs (venture capitalists) and highly successful startup CEOs say the primary roles for a startup CEO are to always keep money in the bank and butts in seats. Both take tremendous time and energy, and they go hand-in-hand. It takes months to close a funding round, and similarly, it takes months to fill roles with the right people. If you’re just getting started with hiring once that money is in the bank, you’re starting from a deficit, burning capital, and straining resources while you get the recruiting gears going.

The number one resource for startup hiring is personal networks. Start with your friends and acquaintances and let everyone know you’re looking to fill specific roles, even as you’re out raising the capital to pay them. As the round gets closer to closing, intensify your efforts and expand your reach.

But what happens if you find someone perfect before you’re ready to hire them? Julien Khaleghy, CEO of MediaNest, says, “It’s a tricky question. We will tend to be generous on the equity portion and conservative on the salary portion. If a comfortable salary is a requirement for the person, we will lock them for our next round of funding.”

MediaNest wasn’t funded when I saw them in Denver, and they weren’t ready to make offers, so why attend a job fair? Khaleghy adds, based on his experience as CEO, “It’s actually a good thing to show a letter of intent to hire someone when you are raising money.”

At that job fair in Denver, MediaNest, with its simple table and two of the co-founders present, was just as busy that day as the companies with a full complement of staff giving away every piece of imaginable swag. I recommend following their example and getting ahead of the hiring game.

As long as you’re successful, you’ll never stop hiring. So start today.

To Raise Capital You Need a Startup Roadshow

By Everything

Originally published on the Softlayer Blog on February 25, 2015.

In the world of big finance, before a company IPOs, the CEO along with an investment banker(s) go on a global roadshow to pitch their business to potential investors, including hedge funds, major investment funds, and other portfolio managers. The purpose is simple: Drum up sales of the forthcoming stock issue. In the startup world, there are no big investment banks scheduling meetings. However, there are opportunities to do a roadshow for your startup, which is even more important than the IPO.

There were 275 IPOs in 2014, the largest number since 2000. By contrast, there are around 500,000 new businesses founded in the U.S. each year (not all of which are tech startups), approximately 225,000 angel investors in the U.S., and as of a year ago, there were 874 venture capital firms [read more]. In big finance, a few companies compete for the attention of a small, accessible group of investors. In the startup world, a large number of companies must seek capital from a huge pool of often-hard-to-find, geographically dispersed investors. Because of this, a roadshow is even more important for startups than it is for IPOs.

The SoftLayer Catalyst team works with startups in communities as big as San Francisco’s Silicon Valley to as small as Cedar Rapids, Iowa. The number one thing entrepreneurs outside of the major financing hubs ask about is how to access capital. My response is always the same: Your job isn’t to bring more capital to your local community; it’s to build a great company. You know where the capital is, so build something worth investing in, and then do a roadshow.

Practice Locally

Thankfully, as the startup world grows & matures, the number of outlets for pitching increases every month. There are opportunities in most cities to stand up and pitch your idea to your peers or investors. Start by getting out in front of your local community as often as possible. In the Boulder/Denver community, there are a few companies that I see pitch all the time, and those companies have fantastic pitches because they are constantly practicing, getting feedback, and refining.

Look for meetups that focus on pitching such as 1 Million Cups and House of Genius, or simply do a search for startup pitch meetup in your city. During startup weeks or similar events, search and sign up for pitch practices and competitions. If your co-working space is like SoftLayer partner Galvanize, they might have a big member pitch competition or a peer-to-peer practice event. Participate in as many local and regional pitch competitions as you can find. As long as the competitions don’t take a piece of equity or require a significant payment to participate—either of which should be very carefully evaluated beforehand—sign up, and compete. This constant exposure to your local market will help spread the word about your company, provide feedback on your pitch, and maybe even score some prizes!

For more advice on your pitch, read my previous post, Advice from the Catalyst Team: Pitching Like George Lucas.

Maximizing Your Startup Roadshow

Now that you’ve refined your pitch and practiced in front of as many local audiences as possible, it’s time to start planning your roadshow. Traveling on a limited budget means you must plan a highly focused trip with a specific goal in mind. Maybe you’re traveling from New York City to Philadelphia for a competition, or from Portland to San Francisco for an investor meeting; no matter the reason, it’s imperative to maximize your trip. A good roadshow involves getting the absolute most out of your travel budget, and this means booking meetings with potential investors or customers.

For example, while attending StartSLC, I visited with a friend from Colorado, Ryan Angilly fromRamen. Angilly traveled to Salt Lake City to participate in the pitch competition, but he made the most out of his trip by filling his calendar with investor meetings throughout the week. Before his trip, he reached out to his contacts in the startup community in Utah and asked for introductions. After following through with the contacts, he met with investors he would have otherwise never met.

Start by either allocating a budget for travel or identifying the most important pitch competitions in your region or industry. Once you have your trip scheduled, immediately start looking for connections within your network. It’s far more effective to say, “I’ll be in town the 12th to the 14th; what does your schedule look like?” than a non-specific request such as, “When are you available?” Look for connections with ties to your local community as they are more likely to be helpful and make intros on your behalf. And ask around locally about who has ties to your destination. Get your meetings lined up, and get ready for a whirlwind of pitches on your first ever startup roadshow.

I’ll leave you with this final point: In 2014, venture capital firms raised nearly $33 billion, a 62 percent increase over 2013 levels. They’ll spend the next few years investing that money in startups. The money is out there, and you need to do a roadshow to find it.

Advice from the Catalyst Team: Pitching Like George Lucas

By Everything

Originally posted on the Softlayer Blog on December 4, 2014.

SoftLayer’s Catalyst team hears startup pitches constantly.

We support more than 50 accelerator programs in the Global Accelerator Network, theTechStars programs, five hundred startups, and more. We hold office hours, offer pitch practice, and attend demo days—in short, we hear a lot of pitches.

Condensing the essence of how you’re changing the world into a five minute sales pitch, while still including other key elements like the business model, traction, early wins, team, and “the ask” is incredibly difficult. There’s a lot of ground to cover and very little time to do it, especially when you consider that likely half of your audience is focused on their phones.

A pitch must be concise, informative, and attention grabbing. The worst thing you can do is pitch like George Lucas’ dialogue in the Star Wars  prequel trilogy movies—clumsy and over-explaining.

Yoda: Always two there are, no more, no less, a master and an apprentice.Mace Windu: But which was destroyed, the master or the apprentice?

This particular quote is the epitome of terrible dialogue because it communicates the same thing multiple times; the second line is superfluous. I don’t need Mace Windu to re-explain to me exactly what Yoda just said. I have ears. I’m paying attention. Imagine how much more powerful that scene would be with just the first statement.

Most of us have a natural tendency to over-explain a point, but by doing this, we insult the intelligence of our audience. Plus, over-explaining eats up precious time and causes the crowd to disengage. I can’t think of a worse combination.

If you find yourself saying any of these phrases, cut them immediately:

Let me show you . . .
I’d like to tell you . . .
I’m going to . . .
I think . . .
For example . . .
As I said before . . .

Simply put, don’t tell me you’re going to tell me something. Just tell me.

George Lucas did write some great lines of dialogue. Watch the Dagobah scenes in Empire Strikes Back. Yoda’s lines are pure brilliance. The message is simple and powerful, which makes it one of the most memorable lines in cinema.

“Do or do not. There is no try.”

During a pitch, you’re not writing a screenplay, so you don’t want to leave your audience guessing, but you still need to explain the problem, the solution, and why you’re the best at solving it. Don’t leave your audience confused from a lack of information, but don’t insult their intelligence by telling them you’re going to tell them something. Just tell it. Or better yet, show it.

You want your pitch to be like a Lightsaber: an elegant weapon for a more civilized age.

A Letter to City Council, and Dealing with Difficult Situations

By Universe

 

Quickleft brewfest - Courtesy of 23rd Studios

On Sunday—a day I promised myself I’d do no work—I opened up Twitter and came across a link to an article, “A necessary education on Boulder’s startup community” written by Nicole Glaros, Rajat Bhargava and Jason Mendelson. I was shocked and appalled, and quite frankly, felt something must be done about it. I retweeted it. That didn’t feel like enough. I emailed the article to some fellow Boulder startup leaders & feeders. That didn’t feel like enough either. I needed to take another step.

I’m a big believer in confronting difficult situations head on. Two of the more common phrases around this idea are, “take the bull by the horns,” or “eat a frog first thing in the morning.” The one I prefer is, “lean into the pain.”

Lean into the pain.

I first heard it as attributed to Coach CEO, Lew Frankfurt, and it resonates with me. I don’t like conflict, and I think that’s a good thing, but I don’t shy away from it. The people I’ve met who seem to enjoy conflict are among the worst people I know in this world. For me, conflict is difficult (maybe painful), but necessary at times. I lean into the pain. I like the phrase because it reflects a certain necessary reluctance, while acknowledging that a challenge must be overcome.

That was forefront in my mind as I began writing an email to Macon Cowles and the Boulder City Council. I felt a personal obligation to say something on behalf of myself and the community I love. It was a “lean into the pain” situation. Did I want to put myself on the line in such a direct and forthright manner? Maybe. Is it scary to do so? Yes. But I  knew it was something I had to do. I felt if I didn’t say something, I would be letting myself down. I took the time to tweet it, then to email it out to friends and colleagues, I should take the time to express my thoughts directly to the person who started this chain of events.

I hovered my mouse over the Send button. I reread my email. I made minor modifications. I hesitated. Putting myself on the line, putting my thoughts out there, confronting someone directly: it’s all scary stuff. I leaned into the pain, and hit Send. And felt really good about it.

Within a few minutes, I received a response from Macon, apologizing for his statement, forwarding his note to Jason, and taking me up on my offer to meet me and get to know the startup community. I thanked him for this and we set a time to meet for coffee in a few weeks.

I feel good about taking a step to bridge a divide, and extending an invitation to someone to learn and participate. This is one of the core missions of Engage Colorado, the group Tim O’Shea and I formed to build bridges between entrepreneurial communities.  I leaned into the pain (hesitation, and fear in this case), took a step, and will look to bridge a divide.

When you find yourself at a difficult crossroads, lean into the pain. Take the difficult step that you don’t want to, but know in your heart is the right course. Look to make a difference, and you will.

Photos courtesy of 23rd Studios


 

What follows is the email I just sent to Macon Cowles and the Boulder City Council in response to Mr. Cowles remarks about the Boulder startup Community, and his response to me.

Dear, Mr. Cowles & the Boulder City Council,

I was disgusted, embarrassed, and upset to read the comments characterizing the startup community as a group of highly paid white men, and then putting the burden of increased housing costs squarely on our community’s shoulders. This is a terrible stereotype for a community that is actively inclusive.

I fully support the response from Nicole, Rajat, Jason, and others in their Daily Camera article.

The majority of members of this community are hard-working, middle class Americans who believe that they can have a positive impact on the world through their efforts. And I would venture to say most of whom would align with you on working to make housing more affordable in Boulder.

I challenge you to compare the Boulder startup community to the Boulder community at large. I wonder, are your stereotypes reflective of the city population as a whole? We, as a city, certainly suffer from a lack diversity, but it’s not from a lack of invitation or openness that the startup community here exemplifies.

By making such off-hand, unsupported comments you tear down what thousands have worked so hard, for decades, to achieve. We stand out as an icon for cities around the world. I have personally been contacted by startup leaders from Canada, Denmark, Tel Aviv, Singapore, Hong Kong, as well as dozens of cities throughout the US, all of whom look to Boulder when building their own startup communities.

What Boulder has built is a model that cities—around the world, large and small—look to for guidance. For a city council member to stereotype it, and tear it down, is embarrassing and counter-productive.

I would like to invite you to get involved in the startup community, to attend events, and meet the people who make this community the global icon that it is.

Personally, I am working with a friend to bring two new events to Boulder this year. The first one, NewCo will shine a spotlight on entrepreneurship and innovation in the city. I would like to personally extend an invitation to the entire city council to attend. If you are interested in getting to know the startup community, please reach out to me and I will give you a ticket, and do what I can to introduce you to the diverse, hard-working Americans who make our community amazing.


 

Dear Rich:

I apologize to you and agree that it unfairly stereotyped the startup community.

I offered my apology to the writers of the OpEd in the Camera, in the following email that I sent to them this morning:

“Jason, I am sorry for what I said and the offense it caused to you and the people you referenced in your OpEd this morning. My comment gave short shrift to contributions and energy that startups and other high tech entrepreneurs have brought to our community.

“I would appreciate it if you would forward this email to Nicole Glaros and Rajat Bhargava, as I do not have their email addresses.

“Not reported in the Camera was the context of my comments, which was the diversity of Boulder, and the recent release of Google’s numbers with respect to the demographics employees. http://tinyurl.com/kcbkelg

“I would like to find a time to meet with you, offer my apology in person, and get acquainted. I respect your accomplishments and would appreciate a chance to get our relationship on a different footing. Would you be interested in this?

“Thanks very much. And again, I offer my apology to you.”

Also, I accept your invitation to get involved in the startup community and would welcome to get the opportunity to get to know you and the startup community better.

Thanks very much for writing. The best number to contact me at is the -3062 number below.