StartupNorth

  • Contest: The Art of Management tickets

    The Art of Management - Nov 15, 2010 - Toronto, ONOur friends at The Art of Productions have given us 2 tickets to give away. There are tickets to:

    You can buy a ticket right away and get $50 off the regular price (you’ll pay $349) — just use the discount code SK23 and visit http://www.theartofmarketing.ca/promo/SK23 or http://www.theartofmanagement.ca/promo/SK23.

    If this sounds familiar, it’s the exact same deal as our friends at NextMontreal.com (so you can increase your odds of winning by entering at both sites ;-). And we’ll just borrow the

    How to Enter

    • Just retweet this post. That will count as 1 entry. Tweeting multiple times won’t help.
    • For a second chance, help us out by completing this form:
      [gravityform id=1 name=Chancefor tickets to The Art of Management title=false description=false ajax=true]

    November 15, 2010 – The Art of Management

    Management lineup includes:

    Both events look like great networking and learning events. As a startup, we like the chance for “free” tickets.

  • David Crow is moving on from Microsoft

    John Oxley outed the news tonight. David Crow, one of the partners in crime here at Startupnorth, will be off the payroll at Microsoft as of the 24th of September.

    David has spent the last 4 years going to bat for startups inside Microsoft. Anyone who has asked for his help knows just how relentless he has been in making sure that the best entrepreneurs got the support they needed.

    I’m happy to see David moving on. Not because of anything to do with Microsoft, but I just think 4 years is long enough for anyone to stay at a corporate gig. It’s time for David to get back in the game and to kill it.

    Having worked with Dave to organize dozens of events and to write this blog, I can tell you that he is rare in his focus and his ability to obsess with details while still keeping this big picture in perspective (and to remind the rest of us about why we are doing what we are doing).

    He’s not talking about what’s next yet, but I know it’s going to be great.

  • How to prepare for a C100 Mentoring session

    We gearing up for the next 48 Hrs in the Valley here at C100 global HQ. We’ve learned a lot from previous 48 Hrs events so expect a few surprises, to be announced soon.

    But in the meantime, a few dates for you to be aware of:

    • Sept 29: Drop dead deadline for companies to complete the application form
    • Oct 7: Selected companies will be notified
    • Oct 13: First draft of mentor deck due
    • Oct 27-28: 48 Hrs in the Valley

    I know what you’re saying, “What the heck is this Oct 13 deadline? We gotta hand in drafts of our presentations??”

    Short answer: “Yes!”

    The upcoming 48 Hrs will be the C100’s eighth mentoring event and after each one the mentors always told us the same thing, “We wish the companies were more prepared.”

    That is a strange coincidence, because the companies always tell us, “Damn, I wish we were more prepared.”

    Well, the good thing about the C100 mentoring team is you only have to tell us something seven times before we start to take immediate action.

    To make sure everyone feels they are properly prepared, we are asking… nay, demanding… that all companies complete their mentor decks and submit to us by Oct 8 for feedback by our crack team of mentor experts.

    To help you out, here are some useful tips on how to prepare you 48 Hrs mentor deck:

    • Think of the biggest challenge  facing your company and talk about it. What exactly do you want to get mentoring on? (In C100, we call this the “challenge statement” meaning, what is the biggest challenge  facing your company right now)
    • Don’t get bogged down in technology: Mentors want to talk about business issues, not about speeds-and-feeds
    • Don’t talk history: Mentors want to discuss the here and now, the long road you took to reach your current destination probably isn’t relevant
    • Be specific: generic presentations get generic feedback. Drill down into one aspect of your business, describe what is going on, and ask for specific advice and feedback

    Here is a deck template all companies should follow. Your deck shouldn’t be more than nine slides long:

    1)      Executive Summary: Short bullet points what your company does and what is your “challenge statement”

    2)      The Market: Give mentors background on the market your company addresses

    3)      What do you do?: How do you address your chosen market

    4)      Who are your competitors?

    5)      Short background on the team (emphasis on short)

    6)      Financial snapshot including funding, revenues and expenses

    7)      Challenge statement: This is the most important slide of the deck… what issue do you want mentoring on? Be very clear and specific here

    8)      Context: How did this challenge come about? How have you addressed similar challenges in the past

    9)      Importance: Why is addressing this challenge important? What would happen if this challenge was addressed? What would happen if it wasn’t?

    Trust us, follow this template and your mentoring session will be way more valuable than if you didn’t.

    The goal is always to make the mentoring sessions as useful and impactful as possible. So we at C100 will be asking the companies early and often to provide drafts of their decks so we can help ensure they are prepared for the mentoring session and ready to go.

  • Where are the Canadian super angels?

    Boris Wertz asks where are all the Canadian super angels?

    “So when I check Angellist, the most important directory of angels in North-America and Europe, I only find 3 Canadian angels (of a total of 350 registered on the site), two in Vancouver (Danny Robinson and myself) and one in Edmonton (Kevin Swan).”

    While Angellist is not the comprehensie list of global angel investors, it is the best list of Internet and mobile investors around. It has folks like:

    There are angel groups in Canada. You can see the great work that our friend Bryan Watson at the National Angel Capital Association is doing to educate and advocate for angel investments, they provide a great list of angel groups in Canada. There are the efforts of groups like Maple Leaf Angels and the work of Randall Howard with the Golden Triangel Angelnet. And you can see the work that ad-hoc events like Founders and Funders to connect angels with emerging technologies and early-stage companies and founders.

    However there are less well know angels like:

    The thing that makes Angellist so amazing is the self-service nature of first person connection. You don’t need to know the right people. It provides one click, direct access to the key players in the economy of emerging companies. It’s something that is missing from the Canadian scene. The best part of Angellist is that Nivi and Naval validate and reference check all of the angel investors, so the wannabes are edited out. This is an edited list of the best angels actively doing deals.

    Here’s hoping that more Canadian angels take the time to complete their Angellist profile.

  • How to pitch to corporate VCs

    One way to segment  the world of  VC is into two camps: (1) financial investors and  (2)  corporate investors. My guess is that a lot of the VCs lurking around here are what you would call financial investors; meaning, they take other people’s money, invest it in start-ups and try to make more money.

    But there is the other type of investor, the corporate ones. These investors tend to work for a large corporation and invest the company’s money. Their goals are also to make a lot more money off of their investments but they are also tasked with producing a strange and esoteric thing called a “strategic return”.

    In a nutshell, these investors have to invest to make money, and to make their company smarter by learning from you, the clever start-up.

    For start-ups, having a corporate VC as an investor can have many benefits if the relationship is correctly managed including credibility, access to the corporations sales and engineering teams,  access to go-to-market channels, and opportunities to conduct joint R&D.

    So it is important that start-ups realize that pitching to strategic investors is not like pitching to financial investors. So here are a few ideas to get you started on your corporate VC pitch:

    1. Prepare a pitch: Sounds obvious, right? You’d be amazed at how many start-ups show up without a pitch. I guess  they think they can come in and talk shop for 30 or 45 min and that will be enough to land a deal. It isn’t. Show up prepared and ready to go.
    2. Know the company’s investment thesis: Companies aren’t shy talking about their investments, so there should be a lot written about past deals. Don’t come in with a canned investor pitch, read up on past deals and come in with a pitch tailored to the company’s investment thesis.
    3. Tell them why you’re relevant: Corporate VCs often have to get support from a BU for a deal, so help them position your company with the BU. Figure out which part of the company will be most interested in you and explain that in your pitch.
    4. Better yet, have traction: Come in with a history of working successfully with a BU. Show how investing in you will help you scale/innovate and make the BU relationship even more successful
    5. Don’t come in as a competitor: If you’ve built a competitive product that is better than theirs (or so you think), don’t think you’ll get money from them to keep you off the market. They won’t invest in you. They’ll probably just try to crush you. It is easier.
    6. Come in as a partner: If you and the larger company are in the same space, it doesn’t mean they will necessarily be interested in you. “You do software, we do software” is not a compelling reason for a corporation to invest.  Rather, tell them how your software (product, service) will help better position their software (product, service) in the market.
    7. Finances: Oh yeah, nothing drives corporate investors battier than being treated as  dumb money. You’ll need to come in and talk strategic alignment, but very soon the conversation will turn financial. Remember, these people live and breathe your markets every day,  so they can tell if your market sizes/growth assumptions are for real

    Meeting with corporate investors can be a maddening, time consuming process. They will ask a million question not only about your business, but on how your business relates to their business. So you need to know your business cold and their business cold. But if you come prepared with insight and some existing wins under your belt, this crazy process may have a profitable outcome.

  • Toronto community mourns passing of angel investor

    Paul Maasland from CBC
    Paul Maasland source: CBC & OPP

    Local angel investor Paul Maasland was murdered, his body was found north of Toronto at a public boat launch. We extend our deepest condolences to Mr. Maasland’s family. And our sincerest concerns go out to his friends and colleagues at Maple Leaf Angels and his investments (according to Mr. Maasland’s LinkedIn profile) including:

    The conversations with his investees shed some light on Mr. Maasland as an investor. From one of the portfolio companies CEOs:

    “I’d just say he was very generous with his time and resources and provided great input into how we ran [company removed]. He always was positive and excited about the initiatives were were doing.”

    These comments were repeated throughout Mr. Maasland’s portfolio. He was a knowledgeable, generous investor that provided useful guidance and support for his companies.

    This is an unexpected situation for anyone including many startups. It opens questions for startups about succession planning for Board Directors, questions around the Shareholders Agreement and the shares of a deceased investor. Hopefully most Boards are experienced in succession planning. As the shareholders change over time with new investment, replacing board members is a fairly straightforward and common practice (albeit usually under very different circumstances). Regarding what happens to a deceased investors shares this is decided between the deceased’s estate and the shareholders agreement. If an estate needs or chooses to liquidate the investment, many shareholders agreements have a clause that allows the company or other shareholders to purchase the investment at Fair Market Value. There are tax and legal considerations, so this should not be considered tax or legal advice, please consult a professional.

    It’s unfortunate for our small close knit community to suffer such a sudden, tragic loss. We are deeply saddened to hear about the loss of a member of our community.

  • Year One Labs launches

    Year One LabsIn case you missed it on TechCrunch, Year One Labs launched today.  Year One Labs is a startup incubator/accelerator in Montreal with a great team: 

    This a team that is deeply steeped in the Montreal software/internet/infrastructure startup scene. They have a combination of deep technical chops plus the necessary hands-on operations with early stage companies looking for a scalable business model with customers.

    If this isn’t enough they’ve surrounded themselves with great advisors including Dan “I’m Everywhere Man” Martell, Rails core team member and Shopify founder Tobias Lütke and others.

    The Year One Labs Program

    It’s an interesting program that provides:

    • $50k, issued in tranches based on milestones
    • Four partners who will work alongside you and your team
    • An international network of mentors
    • Direct access to Angel investors and VCs, both 1-on-1 and during our Demo Day events
    • Free rent, Internet, coffee etc. in the Year One Labs space

    In exchange for “a minority stake in your startup, typically between 10-20% under standard Series Seed terms”.

  • DemoCamp with Fred Wilson

    Mark your calendars.

    Fred Wilson of Union Square Ventures will be keynoting DemoCamp Toronto # 27 on October 6, 2010.

    EquentiaHow did we pull this off? Well the big shout out goes to William Mougayar at Eqentia, this would not have happened without the support and efforts of William. In case you haven’t seen Eqentia, they power custom portals for media monitoring, competitive intelligence, knowledge tracking and more. They power two sites that I use daily to track the Canadian emerging technology scene: CVCA and NextMontreal news widget.  We’ll be launching a full Eqentia powered news portal in the next couple of weeks.

    The full details about DCT27 are still being locked down. The venue is still to be determined. The venue is the bulk of the ticket price. The goal with ticketing has always been cost recovery and we’ll aim to keep tickets inexpensive (current model show about $25/person less for students). Fred Wilson, Union Square Ventures

    DemoCamp Toronto 27 Details

    • Date: October 6, 2010 [Hold the Date – iCal]
    • Time: 11:30am – 3:30pm
    • Location: To be determined
    • Notify me when tickets are available

    I want to demo! Pick me, pick me!

    We’re also looking for up to 5 local demos that match the investment thesis at Union Square Ventures. If you think your company has the right stuff then you should apply to demo.


  • Startup Weekend Toronto September 24-26

    This is a guest post by Startup Weekend Toronto organizer Chris Eben.

    Let’s build some more startups in Toronto! According to StartupIndex, the GTA has 325 startups – by September 26, we might be able create 10 new startups in Toronto.

    Startup Weekend, a 54 hour event in which teams go from idea to launch to pitch in a weekend, comes to Toronto September 24-26 at Ryerson University through StartMeUp Ryerson. Check it out here and get registered while tickets are still available.

    The only way to determine whether entrepreneurship is for you is by actually going for it, and Startup Weekend gives you that opportunity. Going from idea to pitch requires working on every facet of entrepreneurship – researching a market, articulating the unique value proposition, competitive advantages, user acquisition strategy, business model, building the prototype, and more. You will work on and learn all the critical things you should be thinking about when starting a company and get practical experience.

    After the weekend, you can continue working on your project making it your path to entrepreneurship, or you can take what you learned during the weekend and apply it to your next venture. Over 36% of Startup Weekend companies are still alive after 3 months, and over 10% of companies go on to produce revenue or get seed funding.

    Startup Weekend is a great way to network with other passionate entrepreneurs and find potential co-founders. During Startup Weekend, you will not only meet some talented individuals, you will get to see how they work, helping you evaluate the potential for long term fit. Interaction and exchange of ideas between different teams is common which means your networking opportunities are not limited to your immediate team.

    Every Startup Weekend participant walks away learning a lot about startups and making some valuable connections. There is a great line up of speakers:

    • Mike McDerment, CEO of FreshBooks
    • Mark Ruddock, former CEO of Viigo (bought by RIM)
    • James Lanthier, COO of Mood Media
    • Sarah Prevette, CEO of Sprouter
    • Tim Smith, CEO of GridCentric
    • April Dunford founder of Rocket Launch Marketing
    • Leila Boujnane, founder and CEO of Idee Inc.

    They, along with a growing list of other experienced folks from the local community will be involved as mentors and judges to help teams during their weekend journey and provide constructive feedback. Attendees will take away valuable lessons to be applied to their current projects and anything they do in the future.

    While Startup Weekend is a non-profit organization, there is a cost to the event to cover expenses.  StartupNorth readers may use discount code “StartupNorthSWTO” for a significant discount.

    Follow @startupwkndTO and #swtoronto for news and updates leading up to the event.

  • Learn to get burned

    Picking co-founders and early employees will always be one of the scariest things you do. Even as you are doing it for your 3rd, 4th, 5th of 15th time, you never feel like you are getting better at it, you just start to get a bit more paranoid and careful. There is however a certain breed of entrepreneur out there who have a little more grit in their teeth. Their wrinkles are a little deeper, and their eyes just have that look of intensity that not everybody has.

    Who are these people? These are the battle hardened fighters who have been through the wringer and they have survived. They are the ones who have learned to get burned.

    Getting burned can come in many different forms, but a few stick out in my mind:

    • The useless co-founder
      Smart, fun, caring, prompt. They have all sorts of good qualities and it seems like all of the elements of a great co-founder are there, but when it is time to focus and execute, they start to flake. It isn’t a straightforward flakiness either, it is an awkward, confused and maddening unreliability that makes it even worse. Not only are they not delivering, but the excuses are insulting. They still talk a pretty good game at times, but under the surface you are getting angry.
    • The over-sold employee
      You are a startup but you are growing. You are hitting that stride (10-20 employees) where you need a few great managers. You need someone who is seasoned enough to navigate the ins and outs of a growing employee base without having to come to you all the time. The truth is that you are still running pretty lean though, and these folks cost a lot of money, so you end up with someone ambitious but inexperienced. Sales managers, biz dev, marketing, wherever you put them the result is the same: They oversold their skills as a manager and you’ve been burned.
    • The big team
      You came up with a killer product with a few friends and it seems like all the right people came to the table at the right time. Before you know it you have a founding team or 4, 5 or 6 people. You love them all and it kinda feels like college all over again. Everything just works at first and you get off to a pretty good start. You’ve been burned. Big founding teams become unwieldy and as time goes by different personalities start to accentuate. If you get the mix just right then big teams have some potential, but that usually means getting at least one person out of the mix. If you are starting up with a big team then you have to be ready to get burned, or to recognize when you are the one doing the burning.
    • The “operational investor”
      “I spent 10 years as a CEO before I became a VC” “we only do strategic investments where we can help move the company to the next level for a win-win and synergies with our portfoliotized group of investments” “I am an angel investor because I like to stay close to the company”. Most investors will try to sell themselves to you with some promise of value-add. You’ve seen The Dragon’s Den, Kevin O’Leary would be ready to promise his expertise to an oven mitt knitting startup in exchange for “50% of the action”. Most of these guys are full of crap and the ones who aren’t are golden. If value-add is part of their pitch to you, then make them prove it will happen.

    Both sides lose
    When you hear about someone getting burned you have to remember that the story is never what it seems. There are two sides to what is going on and there will always be a bit of truth to each story. Like in any relationship things get messy during a divorce. People say things they shouldn’t, and it is easy to try to hurt eachother. A “I have to win” mentality can take over and it is hard to shake. If you are on the other side of a vindictive co-founder or employee then it can be hard to look past it.

    You can try to win all you want, but everyone loses. What makes the difference is that some people pick up and focus on what’s next, while others sit and stew. I have done both and believe me, you don’t want to be doing the latter. Those who sit and stew once rarely do it again however, because it is just as painful for them as it is for everyone else.

    Avoid the inevitable
    I asked Rob Hyndman, a Toronto based lawyer who works with a lot of startups, what you can do when you are forming your company to help prepare for getting burned. It might feel overly pessimistic, but the more seasoned you are, the more willing you will be to plan ahead.

    It’s very hard to deal with relationship problems if you don’t have the right structure set up in advance, and you burn a lot of cycles trying to nudge people in the right direction if you don’t have the means to force them to it when you are ready to act.

    Having your energy drained by an ugly divorce is one of the surest ways to sap your enthusiasm for your mission and keep you too distracted to tend to what needs to get done. These relationship problems are one of the biggest early risks that you can minimize with proper care in advance.

    Shareholders agreement provisions like founder stock vesting, and provisions that ensure that founder disputes can be resolved, including with the departure of people who aren’t “working out”, are useful approaches to resolving relationship problems.

    Don’t waste time
    Learning to get burned isn’t about getting burned over and over again, it is about seeing it coming before it happens and heading it off in advance. You need to pick carefully and have a backup plan in place. When it does come time to break it off with a bad partner you need to make it clean. Specifically

    • Be up front: No letters. No emails. No phonecalls. Don’t hide behind a lawyer. This is face-to-face stuff. If it means flying halfway across the country on a Saturday to do it, then you do it.
    • Be sure and be clear: Assuming you have done more than enough to give them a chance to either find a role that works for them, or to do the quitting themselves, then it is time for you to do the hard work for them. When you are being “up front” you also have to be clear: It’s over. It’s over and this is why. State your reasons clearly but don’t talk down to them.
    • Be humble: Like it or not, you screwed up as much as they did, and you are going to be the one left holding the bag of crap. You are not righteous. Take responsibility for what you got wrong.
    • Work together: Especially with co-founders and early employees. You asked them to buy in to something that you wanted to create. Like it or not at some point you sold them on this and they bought in (I know that is true, because you are the one doing the firing now). Work equally as hard to find a way out that makes sense for them and does the minimum amount of harm to their future (and in turn, yours).
    • Work for eachother: In every case it will be a net-benefit to both sides if both sides have a bright future. Work hard to make sure that eachother are successful. This takes an incredible amount of maturity and foresight, but as long as you are building something of your own, you won’t feel like you are missing out on what your former partner, employee or employer have gone on to build.

    It sucks, but it is going to happen to you at some point. Learn to get burned.