StartupNorth

  • Week in Review

  • Riding a Mega-Trend Isn’t the Same as Solving a Real Problem

    Ben Yoskovitz just nailed a big issue that a lot of startups need to come to terms with: A trend is not a marketplace

    But be careful. Riding a mega-trend isn’t the same as solving a real problem. Big, bold statements are great. Startups can very effectively align themselves with mega-trends. But it’s equally important to peel away the big numbers, inevitable trends, and macro factors that seemingly drive opportunity — and get into the nitty gritty details.

    Trends can be powerful and they can distract you from building a sustainable business before you even realize they are, in fact, just a trend. Like platforms, developing on top of a trend takes a certain skill, and a lot of good timing.

    There are a few people who are able to see through a trend to the core problem that sits at the middle of it. Howard Lindzon is someone I admire for his ability cut through the bullshit of a trend and also when to get off the wave.

  • StartupDrinks – YYZ, YUL, YYT, YQM, YYC, YHZ, YFC, YSJ

    StartupDrinks LogoFriendly neighbourhood reminder that tomorrow, June 30, 2010, is StartupDrinks (well tonight in Saskatoon & Regina). On June 30, 2010 you can join entrepretreneurs in:

    Jevon is going to be hanging out in Halifax. Ray is going to be in Montreal. Jonas, Bryan and I are planning on being at Grace O’Malleys (aka Granuaile), 14 Duncan St, Toronto, ON.

    It’s a great opportunity to get out of the office. To be social. To connect with others that are struggling building companies like you. What will we be talking about? We’ll be talking about “How to grow your traffic from 1k to 35k on $0” and other things. What do you want to talk about?

    Here’s

  • Week in Review

  • The best laid 15 year plans

    Southern Alberta Railroad Tracks
    Photo by ecstaticist

    OMERS and ABP announced the launch of INKEF Capital, a € 200 million venture fund that is focused on deploying € 100 million in Canada in 5 years.

    “In the first five years, € 100 million is anticipated to be invested in start-ups in each of the territories, the Netherlands and Canada. The initial portfolio will naturally be weighted towards early stage companies which will mature over the fifteen year term. Deal flow will come from various sources, including technology transfer offices of universities, informal investors, regional funds and from spin-offs of new technologies by existing companies.” 

    This is great. It’s nice to see new capital getting ready to be deployed to Canadian entrepreneurs. What’s interesting is the reason that INKEF believes it is differentiated than other capital:

    “INKEF Capital distinguishes itself from other investors by its long term investment horizon and active mentoring of the start-ups.”

    Makes me wonder what the other firms have been doing? Passive mentoring? It will be interesting to gather more details as content becomes available (Currently http://inkefcapital.com/ is not active and the WHOIS record returns a registrar and intellectual property firm in the Netherlands). This looks it is a direct investment vehicle for OMERS & ABP,  “programs for direct investment as a promising new strategic option”.  I can’t wait to hear Mark McQueen’s take on this, but given we’re in Day 9 of his hunger strike I suspect that you’re stuck with my limited insight.

  • Russia learning from Silicon Valley

    While everyone in Quebec and Ontario were doing the shake-rattle-and-roll, the Silicon Valley establishment was playing host to Russia’s  President Medvedev.

    Apparently having your economy rely solely on exporting oil and mafia dons isn’yt considered sound economic policy so Medvedev got his buddy Ivan Danko to show him around the at likes of Twitter and Cisco.

    In case you’ve been living in Siberia and haven’t heard, Russia wants to build its own Silicon Valley from scratch in a town outside of Moscow. So we guess Medvedev was asking around for the “how to” manual.

    This reminded us of a brief discussion we had over at the C100 website a few weeks back. You can check out the comments over there, but we’ve also reposted here to continue to spur a bit of debate…

    Does Canada need its own Silicon Valley?

    Tuesday, June 1, 2010 at 03:37AM

    OK, I’m going to pull the pin and lob a rhetorical grenade to get a discussion going…

    Have you head of Skolkovo, Russia? No? Apparently it is somewhere near Moscow and is the future home of Russia’s Silicon Valley. What? You don’t believe it? Well some US investors sure do, to the tune of $250 million. And this isn’t the only government backed innovation center that is being built from the ground up. There may be a Silicon Valley being built up in Russia but the Dubai has its sites firmly set to be the 21stSilicon Oasis. Century’s

    Both these locations have or are attracting talented engineers. Both of these locations have or are attracting massive amounts of capital.

    And they aren’t the only two countries that are trying to build their own flavor of Silicon Valley. There are probably a dozen similar projects in a dozen countries around the world. But one country that isn’t embarking on its own Silicon Valley master plan is Canada.

    If a US PE can come up with  250 million reasons why Russia will successfully build the next hub of innovation, surely Canada, with its improving investment climate and its refreshing lack of mafia domination could convince investors to put some green in the Great White North.

    Is Canada missing the boat? Does it need to create a chilly Silicon Valley somewhere near Alert in order to compete in the global high-tech market?

    Discuss…..

  • ScreenScape – Software for screens in public places

    I had a chance to catch up with Screenscape this week after they announced a new round of financing that came in just over $3million. The Prince Edward Island and Toronto based startup will be using the financing to expand sales capability and speed development.

    Screenscape is a web-based tool that makes it easy to create one of the information displays that you see in shopping malls, doctors offices and other public places. Through a simple drag and drop interface you can create a “screen” and add news feeds, local information, and store specific information (such as sales, announcements, etc). They call it “the Google Adsense of place-based media” — and they have some interesting IP that backs that up. The content of a screen can also be tailored based on the overall “power” of the screen. That is: how many people see it, in which demographic?

    The product has also been focused on being a “networked” tool from day 1: Venue owners can share content, advertisements and messages in a marketplace that makes it easy to cross-promote within a specific geography or with partners you select.

    Before Screenscape there were a lot of options for software that would run a single display, or through which you could push content in a pre-determined way to a certain set of screens, but Screenscape is the first tool I have seen that helps decentralize content production, which makes using a display screen a far less daunting proposition for a smaller venue.

    They also plan to add Foursquare and other integrations which could really help make things like Foursquare more accessible and useful for restaurants and retailers. Through the Foursquare API the restaurant could display things like the current mayor, current people checked-in and Foursquare-specific specials.

    Mark Hemphill, the founder of Screenscape, first introduced me to the concept several years ago, before he had the company started or even the first product built. I had some concerns about the usual things: go-to market strategy, product focus and overall product-oriented execution. I was seriously impressed when I first checked in with Screenscape about a year later. The team had grown and so had the product. Mark’s dedication to building an incredibly refined tool for display-management seems to be paying off. The team continues to grow in both Charlottetown and Toronto.

    The pricing, which starts at $10 a month, seems a bit problematic to me, but Mark tells me that they are selling more and more group licenses to brands such as Bauer which are higher volume deals.

  • Can you pitch in 6 slides?

    Can you pitch your company in six slides? I can’t believe that Fred and Brad raised the first USV fund with only six (6) slides.

    “We learned to simplify our story and we learned how to create six killer slides. And killer slides are not slides with a dozen bullets each. They are six powerful points that combine to tell the meat of the story.

    So when you sit down and build your pitch deck, think of six slides that will inspire and leave something for the imagination. The best part of six slides is that you will get through them in time to have a real substantive conversation face to face about your business. Imagine that.” – Fred Wilson

    Constraints are a great thing. They help entrepreneurs filter and focus their presentations and messages. Getting your pitch down to six slides is going to be a challenge, and challenges are fun. I’m a big fan of the sequence of slides recommended by David Rose’s, chairman of the New York Angels, but even this sequence is 15 slides.

    1. Company Title Page
      Start with the name and logo of the company, the name and title of your presenter, a one-line description or tagline about the company, and the dollar amount of the round you are raising.
    2. Business Overview
      Boil down your elevator pitch to one sentence. Tell us what you sell or do in very concrete language. This sets the context for the rest of your presentation.
    3. Management Team
      Show us your talent and experience, with one line of background (two lines max!) on each member.
    4. Market
      What’s the environment in which you operate, how big are the segments, what are the pain points?
    5. Product
      How do you solve a customer’s pain? What exactly do you do? This can be illustrated with a clear product or screen shot, or a simple process diagram, but if we don’t know what you do, we won’t know why we should fund you. (But don’t spend too much time on this, since you’re pitching the company here, not the product.)
    6. Business Model
      Who pays whom, how much, for what and from where. What does this mean for annualized revenue streams?
    7. Customers
      Who are they, how many are there, how do you distribute to them, and how are they attracted and retained?
    8. Strategic Relationships
      If you have any, make sure we know about them.
    9. Competition
      Who and how threatening are they? What are the differentiation factors? Include both direct and indirect competitors. Remember that everyone has competition, even if it is just “the old way” of doing something.
    10. Barriers to Entry
      How will other potential competitors be kept at bay?
    11. Financial Overview
      Show us your top-line revenues and expenses, and EBITDA two years back and four years out.
    12. Use of Proceeds
      Where will our money take you?
    13. Capital & Valuation
      How much have you raised previously, who are your current investors, what are you looking for in this round, and how do you come to your suggested valuation?
    14. Review
      Provide a brief summary of what you said, in this same order, narrowed to the five or six most important points.
    15. Contact Info/Next Steps
      Lead us into the next step, such as a follow-up meeting for due diligence…and include your contact info!

    I can immediately reduce this to 7 slides, it’s not 6 but it’s close. The goal here is not to provide all of the information in these slides but to boil down the critical information to the salient points. I have been using Business Model Generation and the work of Alex Osterwalder to help build a better understanding of business model, value proposition, key partners and revenue streams. This combined with the slide sequence is a really effective way to model your business, customers, partners, costs and revenues.

    Business Model Canvas Poster V.1.0

  • Mentoring Virtually in Toronto

    C100 is hitting the road (virtually) and will be bringing the next C100 mentoring session to Toronto. We’re working with our partners Extreme Venture Partners and are looking for three companies to participate.

    Interested? Please apply via our application process.

    Finalists will be notified week of July 12.

  • Week in Review