Tuesday, March 27, 2007

Trent Miskin v. Jason Calacanis

Just in case you missed it, Trent Miskin called out Jason Calacanis' critique of WeightLossWars and similar sites. His post prompted a defensive comment from the chief bloggerino himself.

Given that Trent and Chad are two of my best friends, I'm a little biased on the matter, so I won't chime in. However, I'd love to hear your thoughts.

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Thursday, March 22, 2007

D.A.M. Truck Tools Steals the Show!

I get pretty excited about early-stage funding, but it's never moved me to tears until today.

Chris Culp, a Cedar City fix-it man without a high school diploma, won a $100,000 investment from an all-star panel of investors at today's Utah Economic Summit funding competition. Chris' simple concept, D.A.M. Truck Tools, went head to head with companies with millions in revenue, Harvard MBA/PhD leadership and stacks of patents. He won with passion, humility, elegant simplicity and good ol' fashioned Southern Utah charm.

He pitched his idea in a simple suite jacket and a pair of white cowboy boots. When angel investors asked him questions about his pre-money valuation, his go-to-market strategy and other semi-sophisticated terms, he answered with a simple, "I don't know.". He never tried to be anything more that what he was: a simple man with an extremely promising product and the humility to admit his weaknesses and ask for help.

After the event I spoke to a class at the Provo Labs Academy about raising money from angel investors where I relayed the story of what Chis had done. After I outlined the most important things an angel considers when looking into a deal a participant asked me how D.A.M. won despite appearing to be weak in many of the categories that are traditionally important to investors. Tough one to answer. I have never seen anything like this in my life.

I don't have any special insight form the investors, but here's what I think:
  • According to research, the most important element that angels look at in funding a deal is the passion and integrity of the entrepreneur. Chris clearly conveyed he had no hidden agendas. He repeatedly assured the investors that he had no business experience and was looking for a partner to handle all of the business side.
  • Because he has very little traction and showed a willingness to share his company, the investors recognized that they could get a lot of bang for their buck. They could have received 20% of a software company with $40 million exit potential or 60% of a company with $20 million exit potential.
  • His product is a slam dunk and the path to market is very clear cut. I think this was a huge factor. While the other companies were very strong, their path to revenue was less clear and that scares investors.
  • The white cowboy boots. 'Nuff said.
Before the event, I had several occasions to speak at length with Chris about his product and his story. The guy is solid gold and no one deserved it more than him. I look forward to following his progress and watching his American dream unfold.

Update: Here are a few stories from the local media on his success: SL Trib, Deseret News.

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Wednesday, March 21, 2007

Utah Bloggers Conference Announced!

Phil Burns announced the second annual Utah Bloggers Conference to be held on July 28th and 29th, 2007. Featured speakers include Robert Scoble and Jeff Barr, with more speakers to be named as the event draws closer.

With Philbert and Money running the show, and headliners like Scoble and Barr, I have no doubt that the event will be off the chain, hook, charts and heezy.

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Tuesday, March 20, 2007

Case study: Humility is good business

Today, I proved myself a hypocrite once again.

Part I

I spoke with an entrepreneur today who really rubbed me the wrong way because of his lack of humility and tact. FundingUniverse offered him a favor that he didn't necessarily deserve and he basically threw the favor back in my face by asking me to "sell him" on why he should accept our favor.

As a result our offer was withdrawn and now it may be difficult for this entrepreneur to raise angel capital here in Utah because his reaction to our offer indirectly insults the leadership of every angel group in the state (It's a long story, but trust me, it does.). Perhaps raising money in Utah isn't his goal -- I don't know. Regardless, his reputation in this area will take a major hit. And that stinks because this guy is an great entrepreneur with tremendous potential.

Part II

Fast-forward about four hours in the day to an important conversation with a new FundingUniverse team member who gave me some critical feedback on our business model. To make a long story short, the conversation was very difficult for me. I found myself foolishly defending decisions that I had sharply criticized weeks earlier in FundingUniverse team meetings. Why did I defend our mistakes? I lacked the humility to just say, "You're right. We were wrong. What would you suggest we do to solve the problem?" Now I have damaged my credibility with a valuable team member and wasted good problem solving time defending a moot point.

Part III

Here I am writing this post feeling sheepish for being a hypocrite, while hoping that the employee that I spoke with this afternoon reads this post and forgives me. :)

I've also relearned that humility -- not to be confused with sheepishness, cowardliness, or weakness -- is a tremendous asset for entrepreneurs who don't have time to damage relationships and defend past mistakes because of foolish pride.

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Friday, March 16, 2007

Killer App: The Boss Button

I laughed out loud when I used the Boss Button (see picture below) at the bottom of cbssportsline.com's live stream of the NCAA Basketball Tournament games. When you click the button, the streaming video screen turns into a page of charts and graphs, saving you from any negative consequences that may come as a result of your watching the games on the job.

I really wouldn't have any use for it because I would never watch any of the UNLV v. Georgia Tech game during business hours, but some people might. ;)

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Breaking news: Congrats to Five GOED Finalists!

Big shout out to the five finalists who will be presenting at the Utah Economic Summit for a shot at a $100,000 investment:
An ultra-big big shout out to all of the semi-finalists who all easily could have made the finals:
If I'm an angel in Utah, I'm licking my chops right now. All of these companies are fundable, in my humble opinion -- yet not the kind of humble opinion that should be construed as a recommendation. :)

Disclosure: Brock and I are very small share holders in Rahster/OnCampusSports, one of the finalist companies. We went out of our way to offer no opinion or vote regarding OCS's selection into the finals or semi-finals. In the interest of avoiding a conflict of interest, neither of us voted for OCS in any round of the selection process.

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Tuesday, March 13, 2007

Paid v. Free v. Freemium and Company-wide Multi-tasking

A couple of blog posts that made me say "hmmmmm" last week:

Blog Post #1

Josh Kopleman of First Round Capital started a great conversation last week with this post. Here's the meat:
The truth is, scaling from $5 to $50 million is not the toughest part of a new venture - it's getting your users to pay you anything at all. The biggest gap in any venture is that between a service that is free and one that costs a penny. I can't think of a single premium service that has achieved truly viral distribution. Can you?
Since then, Anne from GigaOm, Jeremy, David, and others ave chimed in with their take on the matter. I've blogged too much about free v. paid v. freemium lately, so I'll just let you check out their stuff. I'd love to hear your thoughts on the matter.

Blog Post #2

Hummer Winblad's Will Price wrote a great piece on the tendency of entrepreneurs to make their companies "multi-task".

Many of the entrepreneurs that we work with struggle with this issue, and I'd be lying if I said that FundingUniverse hasn't fought the tenancy to become all things to all people. Sometimes it's tough to focus when you're out to change the world, but it's imperative to do so when manpower, capital and time are scarce. Find the business model that provides the shortest distance between launch and cash flow, and stick with it.

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Saturday, March 10, 2007

" Oh yeah, I know him. I know him well."

You've seen the "man law" commercials on T.V. where a group of ultra manly men declare the laws of manhood over bottles of brew. Well, I'd like to propose two "business laws":

1) Unless a person remembers your face, your name and your company, you are banned from using the phrase "I know him/her." in reference to said person.

2) Unless you regularly exchange email, have lunch regularly with or know the person on some sort of personal level, you are banned from saying that you know said person "very well".

I don't know how many times I hear people throw around the above phrases when the reality is the person they "know" is someone they shook hands with in a crowded room months ago.

All in favor ...

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Traction Killed a Lot of GOED Applicants

Trent, Brock and I spend a good part of our day today narrowing the list of $100,000 Funding Competition applicants from 100+ down to 20 finalists. I am amazed, but not surprised, by the number of quality businesses that applied for the competition. Congrats to everyone who applied!

A couple of observations from the selection process:

-- First and foremost, it is hard to overstate the importance of traction in raising capital from angels. Many of the applying companies had interesting ideas and capable management teams, but had made little or no progress towards making any part of their idea a reality. If you are raising money from angels, go out and do something -- sell a product, recruit a killer board of advisors, get a patent, raise money from your family and friends, get a beta tester, get commitments from a distributor, recruit a key team member ... you get the point. Your chances of raising capital will increase dramatically. All of the companies that made the final cut have done many of the these things.

-- If you are not a technology/biotech company, you can raise money from angel groups. One of the angels on the investment committee for the competition specifically stated that he and his group are looking for deals that aren't tech/bio. There are a lot more angels out there who fall into this set than you might think. Most of them have a little grey hair and made the money that they use to invest before the Internet existed. There are a significant number of finalists who don't fall into the traditional categories.

The final five will be chosen early next week. We'll announce the finalists in the FundingUniverse weekly newsletter next week.

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Thursday, March 08, 2007

A WeightLossWar is waged!

My main man Chad Blodgett just launched WeightLossWars.com, a smokin' social network for people who are trying to stay fit and/or lose weight. It's already my favorite social network for several reasons:

1) Summer time is right around the corner and I need all of the help I can get to slim down to my 190 lb target weight. On WLW, I can ask my friends to help me lose weight by becoming my "motivators". That means that every day when I update my profile -- how long I worked out, how much I weigh, how far I ran, etc. -- they get an email that charts my progress.

2) I'm in sales and business development, so I love numbers. When I input my stats, WLW automatically generates a graph for me that charts my progress.

3) This is the first social network that I have convinced my wife to join. She's always been a hater of the 2.0 stuff, so this is a big step in our relationship. :)

If you want to get in on the comedy that is my attempt to lose weight, create a profile and send me a request for friendship. My profile name is jjordan.

Congrats to Chad, Blake and the Griffio team for teaming up to make this happen!

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Tuesday, March 06, 2007

Devin Thorpe Gives a Little Love to my Home Town

Devin Thorpe gave my home town -- Visalia, California -- a little love in his blog today. It's a shame that it's so expensive to fly there, because the San Joaquin Valley is home to some of the most agriculturally rich (and beautiful) country in the world. As I love to point out to my Floridian wife, in Central California we produce more cheese than Wisconsin and more oranges than Florida.

I'm also glad to see Devin visit my home town because that means there are a few Visalia "harvests" taking place somewhere other than the alfalfa fields. I'm actually good friends with the prospective client that Devin went to visit, and Devin will be sitting pretty if this prospective client becomes a success story. Good luck, Devin!

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Friday, March 02, 2007

Does your seat float?

I was trying to phase out the usual flight safety song and dance on my Delta flight to Denver tonight when I caught a very interesting piece of the presentation:

"Most of your seat cushions can be used as floatation devices ..."


Most of them? What are they going to say next -- "Most of your gas masks will work in the event that the cabin is filled with poisonous gas."? I spent a good portion of the flight looking at the passengers within sight of my seat thinking to myself, "I wonder if he's the one who's going to be mooching float time off of me and my seat if we crash into a body of water ..."

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Thursday, March 01, 2007

Social network + nice revenue stream idea = Shelfari

Yesterday, I blogged about the fact that too many media companies, including social networks, launch with the fear of using something like a premium subscription model to augment their advertising revenue stream.

Shelfari, an Amazon backed soc. network, for book lovers, is a great example of a social network with a cool built-in revenue stream.

Users can post their "bookshelves" so other people can see what they have read and find other readers with common reading preferences. You can find reviews, post reviews, ask questions about books and ... drum roll please ... buy the books off of Amazon. Convenience for users, revenue for Shelfari. It's not rocket science, but it's cool.

As a user, I wish it was easier for me to buy books through Shelfari. I found a couple of books that I ended up purchasing, but it took me a while to find the place to buy. I want to be able to click on the picture of the book and have it take me straight to the page with opinions and the purchase button on the right. Otherwise, I love the site and look forward to helping them make money.

My profile name on Shelfari is jjordan. Feel free to find me on the site so I can learn about what you're reading.

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