Year: 2012

Do Startups Need Community Managers?
Editor’s note: This is a cross post from Mark Evans Tech written by Mark Evans of ME Consulting. Follow him on Twitter @markevans or MarkEvansTech.com. This post was originally published in March 26, 2012 on MarkEvansTech.com.

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Do start-ups needs community managers to operate their social media activities…and a whole lot more?

It’s an interesting question. On one hand, social media is seen as a low-cost marketing and sales channel for lean and mean start-ups. On the other, every full-time hire is a major decision so start-ups need to decide whether having a community makes sense, or whether having another developer or salesman is a more pragmatic option.

If the right person is hired, a community manager can be a valuable asset for a start-up. There are, however, several important skills a community manager needs to possess. These include:
1. Have in-depth knowledge of social media strategy and tactics. It’s more than knowing how to tweet or post an update. It means knowing how to execute, when to get involved in a situation and when to lie low, and how to build relationships and connections.
2. Excellent communication and writing skills given so much of what a community manger does is engage and talk with a variety of people in a public forum. A good community manager has the ability to prepare blog posts, presentations, case studies, and speak at conferences.
3. Understand and appreciate the business development process. In talking with lots of people and consuming tons of information, community managers have the ability to discover, identify and nurture prospects, which can then be passed along to the sales team.
4. Provide top-notch customer service. It means having the knowledge and patience to deal with all kinds of issues and problems – big and small – that emerge. Some of them can be handled online, while some needs to be tactfully taken off-line.
5. Sell and, even, close a deal: There are potential customers who make it clear about the products they need. A savvy community manager will be all over these opportunities with the goal to complete a sale.
Like a stellar five-tool baseball player, community managers require a variety of skills to not only be effective but provide startups with maximum bang for the buck. They need to multi-task AND be good at all of the tasks that pop up during the working day.

Community managers who have these skills can completely justify their hiring and, in the process, serve a startup in many ways to support its operations and growth.

What do you think? Is there a right time for a startup to hire a community manager?

Editor’s note: This is a cross post from Mark Evans Tech written by Mark Evans of ME Consulting. Follow him on Twitter @markevans or MarkEvansTech.com. This post was originally published in March 26, 2012 on MarkEvansTech.com.
March 26, 2012
Nail it before you scale it
Editor’s note: This is a cross post from The Meaford Group written by Peter Smith (LinkedIn). This post was originally published in January 28, 2012 on The Meaford Group.

I love working with Robin Hopper, my co-EIR at the Innovation Factory, for the simple fact that the guy has more catchy cool acronyms and phrases that make me sound so smart when I repeat them. “Nail it before you Scale it” is one of his latest.

Put simply, too many start-ups try to scale their marketing and sales organization before they have nailed their value proposition and the sales story that goes along with it. The consequences can be disastrous. Over a beer, ask Robin about the story of how he blew through $3,000,000 in investment capital on one of his early start-ups because he expanded too early without really having the customer-compelling value proposition figured out.

Howard Gwin talks about the need for first time founders to create momentum and velocity in order to overcome the investor bias against funding first-time teams. (The Three P’s of a Technology Company). If you haven’t read his blog, do so now. He offers sage advice to wait before seeking VC funding until you have “proof points and a traction story that is damn near breathtaking”. Beyond that, don’t fall into the trap of trying to create that momentum before you fully understand why the market wants your technology and how you package it for consistent, reliable and predictable sales.

At the Innovation Factory, we work with many start-ups. Most go through one or more “Pivots” before they find the kernel at the core of their product or idea that will really sell. Unfortunately, some will never find it because even though the idea or technology was interesting or cool, the product will never be compelling to an intensely competitive marketplace. Good entrepreneurs figure this out fast and kill the idea but then move on to another.

I recently met one of these entrepreneurs. He built and sold his first company when he was 19 for $100,000. (It may not sound like much but I wish I had a hundred grand when I was 19). His second company was a professional services company. He built it, had success and then killed it because he realized he could never scale it fast enough to fulfill his dream. His third company was a software company and dealt with project management infrastructure. The idea and technology were good but the market was crowded and more importantly, the sales process would be long. There also were too many factors out of his company’s control in the value chain of customers getting value from his product. He had arranged Angel funding and was ready to launch but instead he listened to advice and killed the company before taking the investment. His fourth company looks like a winner. It is in a hot space, has uniqueness, has the ability to scale quickly around a solid value proposition and he has surrounded himself with a good team. He has also already pivoted at least once on his value prop in order to get ready for traction.

So, if you are early in your game, my advice to you is simple:
1. Figure out your value prop
2. Keep pivoting it and your company until you have proof points that you can create massive momentum and traction quickly
3. Use Friends & Family and Angel funding to keep you going through these phases
4. Then go talk to VC’s.
In other words, “Nail it before you Scale it.”

Editor’s note: This is a cross post from The Meaford Group written by Peter Smith (LinkedIn). This post was originally published in January 28, 2012 on The Meaford Group.
March 21, 2012
5 Steps to an Awesome Executive Summary
Editor’s note: This is a cross post from Massive Damage Inc. written by Ken Seto, founder of @Massive_Damage & @EndloopMobile. He is building @PleaseStayCalm, a location based game.. Follow him on Twitter @kenseto where he tweets about Apple, music, games, food, wine & movies. This post was originally published in February 21, 2012 on MassDmg.com.

We’ve finally decided to post our Executive Summary to share with other founders as we’ve always had compliments and great feedback from it.

Some folks wonder how best to use executive summaries.. basically you’ll give it to people who will be doing intros for you. That way, they can forward something that piques the interest of the potential investor without giving away the whole pitch. You don’t want your deck to do your pitch for you, you want to do the pitch.

Here are the following guidelines I followed to create ours:
1. Keep it to one page if possible, it’s a summary, not a pitch.
2. If you have no eye for design, hire one or get a designer friend to help out.
3. If you have metrics, put the good stuff front and center. Feel free to use vanity metrics for big impact but make sure you also have engagement metrics.
4. Leave enough room for your Team section. Use pictures and previous startups/accomplishments.
5. Include awesome visuals. Sure you can’t use zombies for every startup but give it some personality. Use bold infographics or charts.
Here’s our Executive Summary:

Massive Damage Executive Summary

View more documents from Ken Seto

Editor’s note: This is a cross post from Massive Damage Inc. written by Ken Seto, founder of @Massive_Damage & @EndloopMobile. He is building @PleaseStayCalm, a location based game.. Follow him on Twitter @kenseto where he tweets about Apple, music, games, food, wine & movies. This post was originally published in February 21, 2012 on MassDmg.com.
March 15, 2012
Work-Life Separation and Institutional Funding

I met with a friend this week who has a job. He’s working on a side project with a friend. They both hope to leave their jobs in the near future to work on this new side project full time.

Both partners in this side project have kids, young families. One of the questions he asked me was around fund raising. Specifically the concern that raising funds from institutional investors or angels may put them in a position where they’re being forced to work more than the 60 to 70 hours they’re currently working. Ultimately the concern being that they’ve seen people lives ripped apart by this.

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My response was reasonably simple. Product based businesses can, and likely will, consume you and everything in your life. Services based businesses are a lot of work, products are all consuming. If your personal relationships and your support systems aren’t strong, they will get ripped apart. You can’t blame that on investors or entreprenership.

Now for the good news. If your project does not consume you then you have the wrong project. Drop it and move onto the next one or go ask for your job back. Investors won’t force you to work long hours. If they need to, wrong project, drop it, move on.

I’ve said this before, I don’t believe in the myth of work-life separation. In fact, anyone who brings it up with me, I immediately know they have a job they don’t like. Work-life separation was born of the industrial revolution. You need it to shield that crappy job from your life. Now, full disclosure, I’m drafting this post at 4:21am while you’re cozy in bed. People often use that measure “are you excited to get out of bed and get to work in the morning?”. I use the measure, if you’re sleeping well every night then you may have a job.

My work is my life. My life is my work. I bring all of me to both. Work makes my family stronger, it makes my relationships with my kids stronger, they all feed off each other. The last time I had a corporate gig, my family suffered. That’s just me, I’m not suggesting it’s you.

If you have a great work-life separation today, I’m not advocating you change anything. If, however, you want to work for yourself someday then it’s time to start tearing down that divider. Start by bringing more of you into your work and more of your work home. Don’t worry about losing it or maintaining that barrier, start destroying it. It’s the only chance you have of success out there.

March 2, 2012
Ladies Learning to Code is Not About Women

There is this small but fierce not-for-profit called Ladies Learning to Code. It has pretty straightforward but profound ambitions: “designed to help girls see technology in a whole new light – as a medium for self-expression, and as a means for changing the world.” (Girls Learning to Code camp).

I started my first tech company while I was still in grade school. That experience changed the path of my life forever and I was able to do that because when I was in 7th grade I started to learn to program.

My family couldn’t really afford a computer, so I used the ones in the computer lab at school a lot. There was a math teacher, Mr. Murley, who would basically be there to open the lab and help teach programming 24/7. I also had some neighbours who had a computer and I would stay there until midnight many weekend nights.

Learning to code early on taught me a few things I am forever grateful for. I learned that I could create whatever I wanted. At that age and in that time you really did have the sense that you could change the world with a few hundred lines of code. All you had to do was find something that was broken or an idea that had potential and you could just build it. I think you can build even more today and because there are better ways to distribute you can have an amazing impact.

A lot of navel gazing here, I know.

There is no more important challenge for the tech community in the next decade than to find a way to make programming accessible to as many children as possible.

We need to do that for a lot of reasons. We need future employees of course, and we need a more tech-savvy population to market in to, but we also need a broader and more diverse pool of ideas and inspiration.

We need kids to believe that they can change the world so that they can grow in to adults who do change it. There may be no better way to enable them to do that than helping them learn to code.

So, when I saw Ladies Learning to Code for the first time I had no small hope that this wouldn’t be just about teaching women to program. My hope is that we can take the model that works for Ladies Learning to Code and that we can find ways to apply it to help make programming a less mysterious endeavour for every curious mind out there.

It’s true that not every child will want to program and I am sure only a fraction will pursue it as a career choice. I also know however that no child who learns will be unchanged. They will learn that they can create something from nothing, that there is nothing they can imagine that they cannot build, and that every tool they possibly need is available and free.

My home province recently took the X-ACTO-knife to the public school IT budget. As if growing up in the most rural province in Canada doesn’t make it hard enough for kids to pursue a future in startups, software development or IT, now there is a provincial government which is actively dismantling IT in education. (Note: Premier Ghiz– who the hell thought that was a good idea?)

I have little hope that our governments will figure this out in the next 20 years and so while school budgets are slashed by uncompromising governments, we have a job to do.

Ladies Learning to Code gets us off to a fantastic start, but the work is just beginning.

February 26, 2012
Toronto Startup Heatmap

Joe Greenwood is directing a new project that pulls together data to track Ontario’s startups. One of the first data sources to be tapped was the StartupNorth Index, which in conjunction with MaRS client data has been crunched into a heatmap of 670 startups across Toronto. Not surprisingly, the ideal office is inexpensive, accessible by transit, and close to good coffee. How can you help fill in this map? Build an amazing startup of course.

February 22, 2012
If you want to change the ecosystem you need to build an amazing startup

At Founders and Funders this week we took some time to interview Dan Debow. It was a bit of a love-in I admit but that is just because I really love how much passion Dan has for helping those around him. He has made a big difference in a lot of people’s lives. I’ve benefitted from it and so have dozens of others in the Canadian startup community.

One thing that Dan said really struck me. A little context might help though.

A lot of folks have been working hard to build a startup ecosystem in Toronto. For over half a decade guys like Dan have been pouring energy in to helping anyone with an idea and a glimmer in their eye to start a startup. There are of course formal organizations that do this on behalf of the government, but the fact is that making Toronto a viable city for startups has been a mostly clandestine movement. People working on the fringes to do what they believe in.

Sometimes you hear complaints about the ecosystem. Whether it is Toronto, Montreal, Calgary, Edmonton, Vancouver or Halifax you can find complainers.

“How can we fix the local ecosystem?”

Dan said it best this week and he was clearly passionate about it: You can’t fix your ecosystem. Just get out there and build something great. More accurately he said:

That’s your job. Your only job. Get out there and build something great.

You can stop being shy, coy and tepid about it. Everyone around you wants you to do something great. They just want you to step up a little and say you are going to do it.

I want you to do something great. I want you to put a ding in the fucking universe.

Take your vision and make it even hairier, bolder and broader. Take your product and get obsessed with it. Change the world for people around you and every single one of us will step in line and push behind you.

Dan did it and this week we got to shine the spotlight on him a bit. There are hundreds of folks out there pushing to do it. Stop worrying about the community. Go big and the community will be right there behind you.

The next time we plan a Founders and Funders I want it to be you that’s up there telling your story.

You can be next. JFDI

February 18, 2012
Ctrl Alt Compete – A startup documentary
Interesting my friends from Microsoft are hosting a screening of Ctrl Alt Compete which features our own Josh Sookman (LinkedIn, @jsookman) of Guardly and Brian Wong (LinkedIn, @brian_wong) of Kiip. It’s a documentary about building startups and the founders passion, fortitude and the shear insanity of doing this. Looks like a fun take, realistic take.
- Toronto – March 6^th 8:30am – 12pm Register »
- Montreal – March 13^th 8:30am -12pm Register »
Watch the trailer.

The movies takes a revealing look at the startup and emerging business scene through the eyes of five founders and their teams telling a story of the passion, fortitude and insanity that is bringing a startup to life. Microsoft believes tech entrepreneurship is fundamentally changing the world. The things that developers create; the ideas that they’re able to make reality; the tangible value they deliver is reshaping the way people live their lives every day. Building a startup from nothing to something is hard—REALLY hard.
Red Carpet Event for the Canadian Premiere of Ctrl Alt Compete Screening

Join a networking crowd of investors, community start-ups and entrepreneurial students for the first Canadian screening of Ctrl Alt Compete – a Microsoft movie documentary on what it takes to be a start-up:Passion. Fortitude. Insanity.

There are lots of tech startups out there taking their shot at changing the world. There’s no shortage of ideas. The infrastructure to build quickly is cheaper and more accessible than it’s ever been…there’s lots of capital floating around for the right idea. If only it were that simple! Building a startup from nothing to something is hard—REALLY hard. There is a “story behind the story” of just how hard it is to go from inception to reality and become the products and services that we use every day.

It’s a story of the power of people pouring their passion, drive and dedication into building something that changes the world—no matter how hard.

We believe that is a story worth telling and sharing.

At this premier screening event, you’ll hear insights from industry executives, Start-Ups from the cast and local leaders in the Start-Up community.
February 16, 2012
2011: Glass Half-Full or Half-Empty for Canadian VC?

Editor’s note: This is a cross post from Mark Evans Tech written by Mark Evans of ME Consulting. Follow him on Twitter @markevans or MarkEvansTech.com. This post was originally published in February 14, 2012 on MarkEvansTech.com.

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First, the good news about Canada’s venture capital landscape. In 2011, investment activity climbed to the highest level in four years ($1.5-billion), a 34% increase from 2010, although it is still significantly below the record activity ($2.1-billion) reached in 2007.

The bad news is there’s still not enough supply to meet rising demand, plagued by “continued weakness” when it comes to fund-raising.

The good news-bad news scenario was spelled out in the Canadian Venture Capital Association’s annual report. For those of us in the glass half-full camp, the increase in investment and the number of deal is cause for optimism.

As well, 2011 saw a spike in M&A activity with 34 deals, including two each by Google, Facebook, Zynga and Salesforce.com. And there was a flurry of incubators and accelerators established, including Extreme Startups last week.

Before anyone gets carried away, Canada’s venture capital landscape is a long, long way from being solid, let alone robust. There’s still not enough venture capital for seed, series A or major rounds. And don’t expect U.S. investors to pick up the slack.

In a press release, CVCA president Gregory Smith said there is concern about whether enough fund-raising can be dong to support the demand for investments. This situation was illustrated by the fact new commitments to Canadian VCs were flat last year at $1-billion.

“Canada has a historic opportunity to become an innovation leader,” Smith said, adding that “in order to act decisively on this opportunity, we must first overcome challenges to supplying VC funds that, in turn, supply entrepreneurs.”

So what’s the solution? How can Canada’s venture capital community do a better job of supporting the startup community? There is not easy answer to a problem that has been around a long time and doesn’t look to be changing any time soon. It’s not going to be an easy fix from government or U.S. investors or institutional investors waking up to the idea of venture capital investing.

Perhaps the answer to the problem is this: success. If more startups and mature high-tech companies are acquired, that could (emphasis on “could”) encourage investors (angels, VCs and institutional) to get more involved. Success has a strange way of helping people to see the light or new opportunities that they otherwise would have dismissed or not seriously considered.

That said, success is a double-edged sword. Without enough financial support, it is hard for startups to have enough powder to become acquisition targets. If they’re not interesting targets, there’s no acquisitions and, likely, less interest from investors.

So which side of the fence do you sit on? Are you bull or a bear about Canada’s VC landscape?

Editor’s note: This is a cross post from Mark Evans Tech written by Mark Evans of ME Consulting. Follow him on Twitter @markevans or MarkEvansTech.com. This post was originally published in February 14, 2012 on MarkEvansTech.com.

February 14, 2012
There are two types of startup incubators in the world: YCombinator or TechStars
Note: This is a guest post by Jesse Rodgers who is a cofounder of TribeHR. Jesse specializes in product design, web application development and emerging web technologies in higher education. He has been a key member of the Waterloo startup community hosting StartupCampWaterloo and other events to bring together and engage local entrepreneurs. Follow him on Twitter @jrodgers or WhoYouCallingAJesse.com.

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Incubators and accelerators [Eds note: and cyclotrons] have but one purpose: move startups along in their life cycle at a faster pace than they would normally and increase the likelihood of a return by providing that service. If you are a startup looking at applying to an incubator you need to understand that the differences in how these programs differ go beyond the money they give you in exchange for equity.

An oversimplification of the incubator/accelerator space is to classify them as either a Y-Combinator (YC) or a TechStars (TS). If you really look at the booming world of incubators for high tech startups you see a model that either based on education and peers that is driven by a strong personality (YC) or a model that is more institutional, follows a script, and feels less personal but is more in line with how VC’s work (TS) (I would place 500 Startups right in the middle between YC & TS which is arguably representative of a third type). There is plenty to be found about the differences but here is a bit of a deeper exploration into the differences.

Startup lifecycle

Startups have a number of key phases in development that is best outlined in Fred Destin’s presentation on startup lifecycle.
1. Start
2. Launch
3. Build
4. Chasm
5. Scale
With the 12-14 week cohort models, like YCombinator and TechStars, the focus should be on moving through starting and on to launch phase. There may be some that get into a build phase. The incubator or accelerator hopes that once they are done a 12-14 week program the startup will be in a much better position to move quickly through the build stage and at least take on the chasm phase.

Where I see the key difference between YC and TS is that YC seems to be able to get companies to go through stage 1 to 3 and they accept companies mainly in the start phase. TS seems to not attract a cluster of companies in a particular phase or not care about what phase a company is in.

The basics of an incubator/accelerator (whatever you want to call it)

Within the execution of any incubator or accelerator program there are, in my mind, 4 core stages in a typical cycle:
- Recruitment
- Onboarding
- In the program
- After the program
Within each of these of these stages there are a number of specific activities that all incubators do but in general they aren’t all that different.

Recruitment

YC currently leads the thought leadership with Hacker News, Paul Graham’s (PG) blog, and it’s success. Applicants fill out a form and once told they have an interview, travel to YC in Mountain View for an interview. They get just 15 min with a small panel and the panel does a bunch of tricks to the founders like carrying on side conversations – there are a lot of blog posts about that.

TechStars has adopted a more consistent process over it’s many affiliated programs (it appears) but they lack YC’s Hacker News or thought leadership (although they would claim otherwise). With Techstars there appears to be an affiliation with the Kauffman Foundation and the role they are taking in promoting the incubator model in general they have made themselves an authority in the space. From people I know that have been in the program it is a fairly standard process similar to raising Angel capital.

Onboarding

I am not sure on TS on-boarding but YC has a very short interview to decision to start of program window. YC has a little book that is like a long Wikipedia article written by Paul Graham that offers insights and baseline knowledge. From what I have been told the YC machine is pretty much immediately available to you when they say “you are in” — startups decide when to tell others. What is really interesting is that YC doesn’t announce it. They generally let a company know they are YC funded on the interview day but they don’t make a big announcement or anything.
Not having a big incubator announcement is a key difference here though. I will assume that with TS it is just like YC in that they have decided to fund you, they are now available to you. However, TechStars (it appears) doesn’t approach announcing the cohort in the same way as YC — they announce them ahead of the program.

In the program: peer mentorship, startup culture

Each program runs for roughly 3 months, 12-14 weeks, where mentorship, various events, and a demo day to close it off normally occur. Each week is important given that each team only has 3 months. Over three months there are phases you can generally identify:
- Teams becoming familiar with each other, their mentors, and what they need to do (first 2 weeks).
- The heads down getting stuff done phase (8-10 weeks).
- Funding mode going into Demo Day (2 weeks).
Other incubator programs are fairly similar with any given week involving office hours (optional or required) and a speaker/dinner. The office hours are used to check in and place goals on the teams. Throughout the term there are demo nights, which are used by YC as a way to put peer pressure on other teams that might not be moving as fast as others.
Where they differ here is in the education of the founder(s). From everyone I have talked to that has gone through YC it seems to me it is a very challenging but rewarding relationship for a certain type of founder. That would make sense as a certain personality type will work best with Paul Graham’s way of doing things and will excel. I am not entirely sure it is simply a hacker/coder persona as most assume. I think it is a personality and learning style that goes a bit deeper.
TechStars has a co-working model with parts very similar to YC. The key difference is that TS doesn’t have the Paul Graham approach to educating founders so you will get very different details depending on who is running the program. TS also gives the startups a place to work where YC leaves them to find a house and work out of it.

After the program: Alumni network

The key value any incubator or accelerator provides after the program is the alumni network of companies that are now a few steps ahead (depending on the age of the incubator there could be alumni with very large companies) of the current cohort in the program. Over time these alumni are your best mentors and connectors.

It is at this phase where the greatest value is for the startup, I believe. You now have access to what the old folks call a big rolodex (social graph) that will open many doors which essentially leaves it up to the entrepreneur whether their company will succeed or not. There are few to no barriers, generally speaking.

Any alumni of YC or Techstars still have contact with the folks in their cohort and all cohorts along with Hacker News. Techstars Network is so big they have a conference just for alumni while YC taps its alumni for all kinds of things. Also, founders seems to find going through the program a second time is different but just as valuable. These massive networks of successful alumni with a flock of high profile admirers is very similar to that of Higher Education alumni networks, so much so it convinces me that this entire process is a form of higher education.

Programs that work copy YCombinator, even TechStars did

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The current culture of education focused incubators started in my mind with YCombinator (started in 2005). I believe what we are seeing with the success of YC and TS is new take on graduate school. Both are different, both work, and people can have strong opinions either way. They feed a need that I don’t think people outside of incubators quite understand yet, learning to be a founder is really hard. Being a successful founder is even harder. The bet is that if you help young founders focus on what is important they will see success earlier or just simply see what success looks like.
If you are looking at an incubator anywhere (there are lots of great programs out there) you need to understand that the money is secondary. You need to find a program that will fit with the way you learn and has companies that you want to work with. It is just like how you picked your University or College except this time it can cost you a lot more (in equity) if you are successful.

Note: This is a guest post by Jesse Rodgers who is a cofounder of TribeHR. Jesse specializes in product design, web application development and emerging web technologies in higher education. He has been a key member of the Waterloo startup community hosting StartupCampWaterloo and other events to bring together and engage local entrepreneurs. Follow him on Twitter @jrodgers or WhoYouCallingAJesse.com.
February 13, 2012