omg.vc

Seems to be an unending supply of first-time nyc entrepreneurs. Some are building products, some are building businesses. All are getting awesome experience under their belts that, due to recent market, economic, and technical infrastructure conditions have encouraged people to start something baller. But to build a prosperous and long-term startup-ecosystem we all know we need 2-3 big companies to exit and for their key talent to do it all over again. But where does that initial talent come from? History indicates that they come from BOTH failed startups and successful ones. Case in point- almost every rockstar entrepreneur out there, failed significantly in at least one of their first few ventures. 

So, back to the title. The immediate impact of the down market is that some angel investors are now unable to invest at the rate/level they would like to. Oh noes. More for me. Seriously though, I would argue this is not a major detriment to the ecosystem. Here’s why:

+Cheaper to do a lot with less money
+Many investors have moved earlier stage
+Super Angels/MicroVCs emerged to fill-in the seed investing gap

Sure there is less venture money and firms and more entrepreneurs than there were 5 years ago, but that is in aggregate. In early stage, NYC has seen a dramatic increase in early stage dollar and number of investments on a per entrepreneur basis (note: this includes unfunded entrepreneurs!)

For the most part, the investors unable to invest due to current market conditions are likely unsophisticated investors that don’t know the difference between a convertible w/ a cap and the new roadster drop top they can no longer afford.

Don’t take their money. You don’t need it. You’ve really learned a ton during your recent entrepreneurial endeavor and there is smart money to be had. If this is longer term down-turn, then there is NO BETTER TIME to launch a startup. Google it. Cliffnotes: talent is cheaper/available, customers are willing to explore cheaper options, incumbents are hampered with paying for 25000 mouths to feed while you are still barely (not) feeding 5.  Lastly, if your venture has run it’s course you can still be a part of this ecosystem in a larger and more successful startup. You can be a part of the management team that seeds hundreds of new startups! Every one of these options is awesome and I can’t wait to see which one you take.   

My buddy Steve Schlafman at Lerer Ventures is awesome. You should bring him a gift. 

via schlafnotes:

I’ve been wanting to write this post for a while and Tristan Walker’s latest post on how he got his job at Foursquare inspired me to take the plunge this weekend.  Interviewing is a necessary evil in our society and we all need to go through the process at some point in our lives (unless we’re born entrepreneurs).  There are countless books written about the topic and thousands of self-proclaimed experts who try to prep us so we’re ready to handle any conceivable question.  There are even entire MBA courses devoted to the subject.  Those types of resources have certainly helped hundreds of thousands if not millions of job candidates around the world land the job of their dreams.  The reality is, however, that jobs are more competitive than ever before and the traditional interview is changing, especially in the startup world.  You’re not going to land the perfect job by just having a solid resume anymore, you need to find ways to differentiate yourself. 

Throughout my career, I’ve learned, first hand, that the best resumes don’t always win.  The people who win interviews, more often than not, are the ones who run through walls to demonstrate that they’re deeply passionate about the role and the company.  They go the extra mile.  The winners track down colleagues and acquaintances who are connected to the company and hiring managers.  They also send catchy and convincing emails like the one that Tristan sent to Dennis and Naveen.  Most importantly, they bring gifts to the interview and shower the hiring manager with confidence.  What do I mean by that?

Gifts, in an interviewing context, are the things that resumes will never be able to communicate.  They’re the ideas, the relationships, the execution, the intangibles that are impossible to capture on paper.  There are a variety gifts that a candidate can bring along to an interview and here are some of them based on my experience.

• Be a power user: Over the weekend, I was enjoying a cold beer with “Mike Karnj” Founder and CEO of Skillshare, and he explained that he would rather hire one of his teachers or community members over a random candidate.  “You know they’re already passionate about the product and engaged with the community which is a huge advantage, he told me.”

• Come with prospects: If you’re in Business Development or Sales and interviewing for a role, you should prepare a high level sales plan, develop a target customer list, and be prepared to make introductions to high quality prospects.  In the last four months, I’ve seen several startups hire VPs of Business Development who brought customers in the door during the interview process. That’s how competitive it is our there. In fact, when I was going through the Lerer Ventures interview loop, I connected the partners with several entrepreneurs who weren’t on the firm’s radar. 

• Share fresh ideas: When prepping for an interview a candidate should spend at least twelve hours studying the company, the market and the product.  Seriously. It takes that much time and more. At the conclusion of this deep dive, you should have a solid understanding of what the company does well, where they need to improve, how they’re vulnerable and a sense of what the short-and long-term strategy should be.  You should then pull together a handful of PowerPoint slides which includes an analysis of the product / business and provides actionable recommendations.  This will demonstrate to the hiring manager how you think about their business.  You’d be shocked how few candidates actually do this.

• Demo your work: Come prepared to show your demos, code, and / or portfolio of work.  Paper and ink can’t and will never be able to bring your past projects to life (unless you’re Steve Jobs), so compile your best work and let it stand on its own.

• Offer a free trial: Following the interview, ask the hiring manager if you can help him or her with a small project to demonstrate your competencies.  For example, when I was interviewing for my role at The Kraft Group, I asked Mr. Kraft and Jonathan if I could analyze an investment to show off my skills.  Without much haggling, they agreed.  The opportunity that I analyzed and recommended was Quattro Wireless which was acquired by Apple last year. 

• Become fluent: Learn how to speak their language.  For example, Zynga works in “Zynga time” and there are hundreds of other examples.  I particularly liked this post by Adam Ludwin who touches upon this point.

If you take anything away from this blog post, do everything in your power throughout the interview process to prove that you can do the job better than anyone else starting immediately.  Show you can deliver value even before you leave your first interview. If you’re successful in doing this, the hiring manager will have confidence in you and you’ll make the hiring decision more difficult.  As you can see from above, there are many different gifts (and probably many more) that you can offer to separate yourself from the pack.  The next time you’re gunning for your dream job, bring gifts and you’ll be at an advantage.  Good luck! 

I LOVE my job and want to be great at it. I’ve spent several days over the last few months reflecting on where I’m heading and the person I’d like to be. Much of that will be reflected in my professional style and brand, So here’s a very public stake in the ground which should help me both commit and reflect back in a few years. Thanks to @bussgang and @joevc for inspiration.

The VC I Want to Be follows a few principles to guide behavior and decision making.

1. Earn trust, don’t expect it. In first meetings it’s easy to list hashable cred and who you know in order to impress people, but by the end of any relationship, people will remember you for the way you treated them. For my style, this translates to demonstrable integrity and honesty. I’ve been able to witness our partners give advice to entrepreneurs that is entirely opposed to SoftBank’s interests (e.g. don’t take our money, investor xyz would be a better fit), but is the right direction for the startup. In every case you earn the respect of the entrepreneur, which is more valuable professionally AND financially in the long run.
   
2. Understanding the entrepreneur. I am a bit fearful of becoming an arrogant prick, which I hope is key to avoiding becoming an arrogant prick. Sure, VCs are busy  but the person on the other side of the table has spent countless hours preparing for a meeting in which to talk about what could be his or her life’s work/passion. At one point in time I was turned down by many VC’s. However, those that said ‘no’ in the right way are now my colleagues, friends and even co-investors. This level of professionalism and humility is never negotiable, and stems from a keen sense of empathy.       

3. Be self-aware. Do I honestly know what my value add is to startups today? I’m fully aware that today my value add is minimal compared any VC veteran, but that it grows each day. I believe my pitch for differentiation today is: my training as an engineer doing UX and front end design, working with startups and mobile apps since pre-App Store, and having a sense of entrepreneurship from TechStars, my ventures and my father’s biotech startups. I’m also aware that all of that can be worth jack if it’s not applicable to your specific startup. So, every month I intend to pick a startup and ask for feedback on my ability and value as a VC.  

Lastly, I’d like to ask for your help in achieving these goals. I welcome unsolicited feedback and suggestions to be a great VC. I respond to EVERY email (I try for within 48hrs), live at General Assembly, and can be found on the interwebs via @nikhilkal and nikhil@softbank.com.

An entrepreneur asked me a question today, “Should I launch this NOW or in a couple months once it’s a little more polished.” Often, sooner to MVP the better, but most importantly you can be shielded by Moore’s “Chasm.” In other words, early adopters are a small % of your customer/user population. They have a huge tolerance for crappy products and, ultimately, are not the mass audience you are seeking. Don’t fear the no-man’s land between early adopters and mainstream. Use the Chasm Shield.  

Some thoughts from Tom Eisenmann’s course on Launching Technology Ventures and Eric Ries’s Lean Startup Methodology: 

Launch now (obvi):

• With high uncertainty about problem and solution you need to LEARN, and market feedback is an excellent professor. 
• A radically new product must be observed in use in order to refine it
• Stealth not needed. ”I dare you to try to get a big company to steal your idea.” -Eric Ries

Hell no:

• Disruption of mission critical activity (e.g. Dropbox vs IMVU)
• Early adopters’  needs don’t match mainstream’s needs
• Reputational risk, especially with viral consumer products or highly concentrated market