Lukewarm Response to Presentation

Well, I don't know what happened but the lack of response in the areas which I thought would receive attention is a concern to me. I gave a 7 minute presentation of the business plan with financials and the panelists did not seem very interested in the opportunity.

I could understand if the market growth potential to be a concern, but there were zero questions about the business model. This annoyed me because I spent the most time on the financials and justifying costs and market growth and making what I felt were realistic growth projections.

Did I do such a good job at explaining how we'll be generating revenue that questions didn't need to be asked? Were the revenue models understood when I introduced them? What about how I intended to spend the funding for the seed round? The only question that touched on financials dealt with how my financial projections would be impacted if the initial market focus was made more narrow.

I did receive a question about barriers to entry and how I intended to keep this going. My honest answer was there was zero barrier to entry and I was depending on being first to market.

The other two questions were on the selection of the company name. Two of the panelist thought that the name would a) segregate half of the population because they wouldn't understand it, and b) branding of such a name would be costly because of the consumer would have to be educated.

So what did I learn from this presentation? I learned that as a team, we didn't prepare enough for the presentation. I don't think we understood our audience well enought to anticipate where they'd focus their attention. We didn't practice questions and answers. We didn't do ourselves justice.

Also, I don't think I have the stage presence to connect with the audience. Sure I can do presentations, but I can't sell the message effectively -- perhaps the 7 minute limit is harsh, but a good salesman could have done it in 30 seconds.

No rest for the weary, we're pushing forward,

-john

Milestone Event

So much has happened lately, it's hard to keep up with the writing.

One: The biggest thing that has happened to us recently is the validation of a test/demonstration. I know, I've kept mum about the idea for awhile, and I will still remain so, but the validation came about 10 days after the test was done, so it was unexpected and awesome at the same time.

Two: We've finished our application to YC's winter funding round and it is submitted. Now we wait for word on whether we get to continue our journey in Boston/San Fran or we just do it here in Phoenix. We'll see which dance we get invited to.

Differing Goals

It's been another learning experience this week on how to manage people's expectations and personal interests. After the team meeting on Sunday morning, we left with differing views on what/which idea would be the main objective for the team.

We had two differing camps: Condor or Doberman. Though the Condor idea continued to evolve, this time to remove a critical differentiator for the idea, my gut was still telling me that Condor has a real market opportunity. Doberman was being favored by RG because it was more byte-sized and the expectations for a high-tech solution are lower. I don't think we agree on the size of Condor's market or the problem-space that it may solve. For you readers, I haven't explained Condor and Doberman on this blog, yet. Remember, I only reveal the details after I've set the idea on a shelf and have moved on; see ideas Angus and Bison.

We talked it over again and we came up with a gameplan. We will focus on getting Condor's concept and perhaps a demo ready for the Y Combinator Winter Funding Deadline of Oct 11th. The sooner we get this application into them, the sooner we can apply our energy towards launching Doberman.

The reason for two separate approaches is to appeal to the investment/networking opportunity at YC. Condor may have a greater upside, though it would require more time to implement, so unless we're funded by an angel for a few months, allowing us to quit our day jobs and bang out the product, Condor will have to take a back-seat to Doberman come October. Doberman on the other hand is almost too easy. The upside and potential isn't as great, and since the concept is very low tech, I can't imagine YC would be interested in the venture... Imagine, the solution requires a person to be involved with operations, too!

- I sent out the Condor survey for comments yesterday, so we'll see what feedback we get.
- I borrowed DE's PHP and MySQL Web Dev book, looks like I'll be coding this weekend.

The fun continues!

-john

How does VC behavior change when interest rates are cut?

I posted the following question, How does VC behavior change when interest rates are cut?, on Y Combinator News because I am trying to understand the relationship between interest rates and the likelihood for angels and VCs to actively be investing in start-ups; my post with people's replies can be found at http://news.ycombinator.com/item?id=44771.

I remember a few years back when timing would have made all the difference. I was spending my evenings working with a start-up in Washington, DC to get their business off the ground. They were trying to partner with either Erickson or Nortel to exchange equity for equipment, but the bubble burst and the wining and dining went up in smoke. Ideally, I would like to try and time the launch of a company when angels and VCs are more likely to be handing out money.

Assessing Your Situation

Today is Aug 7th, and the deadline for InvestSouthwest is upon us. Thankfully we're not submitting anything ridiculously thrown together.

But the one that I'm quite interested about has a deadline of October 11 and I'd like to know which one of you (or if you know of any friends) would seriously consider doing this with me.

Visit http://www.ycombinator.com/ and read the Newseek and USA Today links on their page, and then read the "winter 2008 funding" link.

My wife is resigned to let me go because this is all I think about and she has not rejected my suggestion that we may have to sell our house if any idea is really good enough to require my full-time focus.

You may be saying that we haven't solidified an idea yet -- I agree, but once we do get one rock solid -- I'm going to submit it and I want to know who can ride this bus with me. Again, if you know of anyone who would be interested, please let me know. If you want, just email me directly.

Oh yeah, the main thing to remember is this: being in Silicon Valley and working with the ycombinator team (which have founded a lot of businesses we know, even slashdot.org) is the value of who they know and the introductions we can get.

Yes, I am trying to get the same introductions in Phoenix, having signed up for an entrepreneurial program that is jointly funded and run by a VC and ASU. But we're talking Phoenix here, which for start-up investments is not even in the top 5 cities.

Okay, please read and think about your options, your future, and your family. We're all not getting any younger, so the window of opportunity for this kind of stuff gets narrower as the months go by.

Thanks,
john

Application Deadlines

Okay, for those of you interested in going beyond brain-storming, here
is the first line-in-the-sand -- a deadline to meet for getting
funding!

What I'm going to do is to keep an ongoing list of conferences for
funding opportunities in the investment community. It is likely that
these events will be all over the country, so we'll have to decide how
we target them.

In addition to the list of conferences and dates, I'm going to specify
which idea to be pitched at that conference. Initially the idea will
just be the "idea of the month", but as we get to know the investors,
locations, etc... we'll have a better idea for where the investment
dollars are going in that city and we will target the opportunity
better.

2007 Aug 7
- Application deadline for http://www.InvestSouthwest.org, located in
Scottsdale, AZ; event is Dec 12-13, 2007.
- Conference with Angels and VCs

2007 Oct 11
- App deadline for http://ycombinator.com/w2008.html, located in
Cambridge, MA; event is Nov 3-4, 2007
- Investors that provide seed money for startups; seed money is the
earliest stage of funding

More to come...

John

TechCrunch 20

I thought I'd take a moment to introduce a topic to discuss money, how
to get it, where to get, what to do with it, etc...

To kick things off, check out the list of VCs and Corporations
attending the first TechCrunch financing event -- this is an
impressive list. http://techcrunch20.com/look-whos-coming/

Well, maybe we'll attend next year as presenters.

-john