2011.04.08 startup-sauna-stockholm
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C!C
Uppsala, Rice, Berkeley, Technion
CycoreEU-Supply
Ericsson Business InnovationSony Ericsson
Parallel Systems
Co-founder
Founder
Coach
Seed Accelerator19
93
201
1
Startups Academia Industry
KTH-SICS Cloud Innovation Center
Åke Edlund - “multitasker”
Åke Edlund
Startup Life & Seed Accelerators
SEED ACCELERATOR
Part 1/2Startup Life
Something I’d needed when in your ageMy view - minimizing copy-pasteDiscussion – please do interruptAdding realism to your dreams, still keeping them aliveInspiration
Preparing this presentation
Startups, the theory #1
Get an ideaFind a garageCreate a world leading ….Get fundingDo an IPOWorld domination!
Get an ideaWrite a business planGet funding…
Startups, the theory #2
Get/steal an ideaUse open source spare partsAdd your own proprietary partWrite a business planGet funding…
Startups, the theory #3
Get an ideaPatent itWait for someone big to buy you…
Startups, the theory #4
Get an idea that complements some big players portfolioRun your business long enough to attract a good user baseWait some moreSomeone might give you a call…
Startups, the theory #4b
New technologyBuild a long range of products around thisLaunch them one after another…. that’s the official story
Startups, the theory #5
Not muchInspirationalSome “must haves”
What can we learn from success stories?
More to learn here!But who to tell you?
Startups, the non-theory, failures
Great product, won many prizesMany years of hard work in garageBring in fresh VC capitalCEO and mgmt from world class firmDefunct pricing model, non-viralHave to teach the marketHeavy staffing and expansion – burn!Cash flow….
Startup failure #1 – too early
Even greater productStill possible to make betterJumps into an incubatorFix-fix-fix…. (instead of Ship-fix-…)Turns more and more into an R&D projectIncubator hires incompetent CEOs…Times up! Share holders leave.
Startup failure #2 – too slow
Great ideaRunning fast, quick successful rolloutHuge burnrate, but succeeds in getting huge investmentsGreat offering of buyout – but, lost control, can’t get a sellMarket diesStruggle on
Startup failure #3 – lost control
Decide to combine with consultancy
After some years, you realize you’re nothing more (or less) than a consultancy firm
Startup failure #4 – never started
Quite much
But, the risks comes in many flavours
#1: Listen to your intuition
What to learn from these failures?
Why startup?Why me?Why now?
Before we start
“Whatever you are building, it's about passion, and less about the money. Your goals should be about changing the world, or making the world a better place. There are many people who set out to change the world a better place and didn't make a lot of money. But there are even more who set out to make a lot of money, did not make a lot of money and did not change the world.” Guy Kawasaki
Why startup?
Freedom, kind of …CreativityAdVenture, you better like it...
Why startup?
Friends, or not?Getting full commitment – fair shareGet advice, but don’t expect too much
Build your team
Web – blog, mail, twitter…F2F – conferences (outside), …
Build a presence
In parallel with building a businessAs part of product developmentSafer but slowerCash flowReality checkRecruitment
Cost control – consulting
Home sweet home, Cafés, Hotel lobbies, …
Office – do you need one?
Use your networkBuild a presence on the webLot of calls, and meetings
Finding customers
Negotiation – learn how, practiceAsk, and ask againBuild a relationshipLearn to say ‘no’
Meeting customers, closing deals
Cash flow – again!Your time – is limited
Endurance - company
Burn out- not a joke- hard to get back from- signs – that you won’t listen to
Endurance - you
Value your time. Get your sleep. Get time off.
Endurance – work hard, but smart
Do you really need them?For what?How good are they?
Incubators
Did you do your homework?Test it, not only on friendsDo your googeling, but don’t drownDon’t overdo it!
Before buying a .com address
Again: don’t read too muchIt is a highly complex problem, too many unknowns.Get hands-on experience
Before buying a .com address
“You miss 100% of the shots you never take.”
Wayne Gretzky (*)
(*)Thanks John Greathouse - http://infochachkie.com/nps/
Part 2/2Seed Accelerators
Are you a x15 startup?Do you really need them, now?What will it cost you?Are they ‘smart money’ or just money?And are there any? And if not ….. don’t think business angels are that much better.
VCs – old school
Re-think StartupsRe-think IncubatorsRe-think VCs
New School
"Startups can be run so cheaply now (with open-source software, cloud computing, and virtual teams spread across the Web) that many more can achieve profitability without any VC cash.” Paul Graham, Ycombinator
The startup world is changing
"Imagine what it would do to the VC business if the next hot company didn’t take VC at all. The less venture capital there is for new startups, the faster the decoupling will begin.”
Paul Graham, Ycombinator
The startup world is changing
The Innovation Landscape is Changing
Bootstrapping: Cloud Computing, Open Source, Network, Mobility
More to evaluateLess control
Harder to get in earlyMissing more
Lower riskLower investment to more
Faster response
Investor: + -
1. Lower risk2. Quicker to start3. Startup gets further with less
1. More Startups2. More control to Startups
Startup:
BootstrappingMore flexible
Seed Accelerators
Helping many during a short time to get to a good next step. Very early stage. Technical focus. Technical entrepreneurs with Network
Often backed by Venture Capital - that get help with volume and early information and lower risk.
AND
SEED ACCELERATOR
March 2010: "Y Combinator Matures" - 1/4 of Startups Funded Before They Finish the ProgramOctober 2010: 1000 sökandeJan 29, 2011: "Yuri Milner, SV Angel Offer EVERY New Y Combinator Startup $150k"
Seed Accelerator challenges
42
1 2
3
4 5
6
1
2
3
4
5
6
Applications flow
Filtering
Deal making - start
Deal making - end, Finding investments for next step
Value increase
Match making
7
7 “Good ones” - seldom go through these services
- Creating startups from scratch- Helping existing startups and innovative companies on clouds!
SICS Seed Accelerator
SEED ACCELERATOR
SEED ACCELERATOR
Stockholm, examples of ongoing startups
right now
Wrap upStartup Life and Seed Accelerators
Note: Cloud Computing and Startups slides added for later
We could learn some from the success stories, but more from the failures.
Many like to give advice, but most of the mistakes you have to make yourself.
Summary
Don't count on getting external investments.
Don’t think startup, think microstartup
Summary
Leverage on all technology and networking possibly available.
Cloud computing is a good idea for many microstartups.
Summary
Seed Accelerator is a unique starting point for microstartups close by.
Summary
Make sure to follow your heart, listen to your intuition - it is trying to tell you something important.
Summary – Most important (1/II)
And make sure to have a good life at the same time, it is possible to combine with startups.
Summary – Most important (II/II)
Steve Jobs
“Stay Hungry, Stay Foolish”
Extra SlidesMore topics, about me
Part 3/3Cloud Computing and Startups
Where do you have your focus today?
To Create New Business?
Or Manage Server Room(s)?
When to (maybe) use Clouds today?
Time limited tasks
Pilots
Peaks
“We are now working on the new demo ---- but it
will take some time.(Our main computer has
crashed ... )”
2011....
2002. Stockholm. Startup. A typical Saturday evening...
- 3 months of buying- Weeks to get it right- 1 month of POC- Years of ownership
2002. Stockholm. Startup. A typical Saturday evening...
- 3 months of buying- Weeks to get it right- 1 month of POC- Years of ownership
Enter the Startups!
Startups Cloud
"Startups can be run so cheaply now (with open-source software, cloud
computing, and virtual teams spread across the Web) that many more can achieve profitability without any VC
cash.”
Paul Graham, Y Combinator
1. Rise of standards2. First major cloud compu7ng provider outages3. Microso< will be relevant in the cloud4. Rapid consolida7on of exis7ng providers5. Rapid rise of cloud compu7ng startups
“Top 5 predic7ons on cloud compu7ng 2010”
hGp://www.infoworld.com/d/cloud-‐compu7ng/top-‐5-‐cloud-‐compu7ng-‐predic7ons-‐2010-‐188
Every company in Benchmark’s portfolio uses Amazon’s cloud infrastructure in some way, and about one-third of them
operate entirely on web-based services and infrastructure.
Billing startup Zuora, for example, is doing well despite having “not a single IT guy, not a one,” Fenton said – and that’s more
meaningful than an analyst’s report.
http://venturebeat.com/2009/06/25/who-uses-cloud-computing-startups-
do-vcs-dont/
We’re already there
More to discuss….
Recruitment – kind of MarketingNovel professional networks – ycombinatorPricing – an art form, don’t overcomplicate itCustomer demand – do they know best?Execute – improve your skillsLeadership – work on it, dailyTime to market – do you want/can you do it?Business angels – or devils?
Nishing – the key to success and partnershipsInvestment cycles, building a step stone to IPOKnow yourselfPitchingMore on VCsBusiness plansVisions – or mantras, what is most useful, why at all?More on Ycombinator – pro and consExits – thinking about it already?Technology vs Sales – Ship vs Fix
!"#$%!&'(')'$%
Åke Edlund
SEED ACCELERATOR
http://kaljundi.com/2010/12/11/startup-bullshit-bingo