Posts Tagged ‘startup companies’

The Smell of Entrepreneurism in the Morning

Posted in 2010, Uncategorized on March 2nd, 2010 by Robert X. Cringely – 129 Comments

Today is a great day for I, Cringely and for me. It is the day we launch the special web site for Cringely’s (NOT in Silicon Valley) Startup Tour. I wrote a column last month announcing the Tour, which you can read here, but today marks the actual start of this summer’s adventure, because it opens nominations.

Visit the new web site here, but please remember to come back and finish reading this column.

This new web site is strictly for readers to nominate startup companies, discuss them, vote for favorites, then see the results as we come up with the top 24 companies in six different categories.

You have to register in order to nominate or vote, though not to just read.  Many people won’t have to register if they login with their Facebook or Twitter IDs. Registration is important because that’s how we keep people from stuffing our ballot box. That’s the only reason we have registration. I won’t sell your name to anyone, I promise.

Notice that the site (unlike this one you are reading right now) doesn’t even have ads. I want to keep the new site completely transparent and above-board, because I think this might be one of the most important things I ever do in my career so I want to do it right.

As I am writing this, the new site stands empty. There are no nominated companies. That’s your job, not mine. So here is how to do your job. Click on the nomination form and fill it in for any startup company that you think is doing exciting work and deserves recognition. The very act of being considered and discussed by 500,000 readers will give these companies more publicity than most of them would otherwise ever get.  So in this case it is an honor just to be nominated. But having said that, please only nominate really good companies that actually qualify.

After my first column about the Tour I received e-mail from many startups wanting to be considered and one of those was Facebook. I have nothing against Facebook, but I hardly think it qualifies for this project. If the company you are pushing has zillions in the bank and more than, say, 50 employees, it is too darned big. No Facebooks.

Beyond that it is okay to nominate companies that have been around for awhile. It is okay to nominate your own company. This isn’t frigging Wikipedia.

You can add all kinds of supporting information to the nomination including documents and even videos for voters to consider. And remember that not only the nominator can submit such materials, any registered user of the site can do so. This requires registration because there are as my Mom, Mrs. Cringely, would say, assholes out there who will submit all sorts of useless or disruptive crap. This new site is a No-Asshole Zone, so let me know if you come across any nonsense and I’ll take the garbage out myself.

This is an ongoing process that will take at least eight weeks to find our 24 companies. Keep coming back to see the new companies that have been nominated and to discuss them and vote. While the winners won’t be final until the very end, I’ll make sure you have some sense of the deliberations as they go along, so come back for that, too.

Just to recap what I announced last month, my family and I will this summer saddle-up our 1996 Winnebago motor home to visit all 24 finalists, taking with us a TV camera crew. We’ll spend two days at every company, camped in the parking lot or in the CEO’s driveway. Two days is how long it usually takes for my kids to use up all the water and demand a trip to Redbox for new videos.

In addition to two months of ongoing text, audio, and video coverage right here, the 24 finalists will appear in my 12-hour reality TV series which will be on a BIG cable channel, one you have actually heard of that does not include the word “shopping” in its name.

I am also looking for a few good experts to consult on this project and for the TV series. That’s because I want to do more than just publicize the work of these new companies, I want to help them. So if you have been a successful startup CEO, CFO, CTO — anything with a C at the front — and are willing to share a bit of your expertise, please let me know. Experts on startup financing, including venture capitalists and angels, are especially encouraged to apply (bring money — preferably small bills with non-sequential serial numbers).

Some of these experts will come with me to the companies, some will appear only on video, depending on the time they can give to the project.

Not all experts will be accepted. This is my project and I’ll be the one to decide if you get to play or not. Frankly there are plenty of people out there who know a lot but have a hard time being helpful. We’re here to encourage. If any company made the top 24, they are already successful. We aren’t here to tell them how dumb they are and how smart we are.

All decisions are final.

Finally, I want to thank the Ewing Marion Kauffman Foundation of Kansas City for their support for this project, which they jumped on within minutes of hearing about it. Kauffman is the foundation of entrepreneurism and that’s what this startup tour is all about — helping to make America even greater.

But Kauffman and I can’t do it all by ourselves, so if your organization wants to become involved please get in touch with me because I’d like to make this tour an annual event and to help technology startups become as important to television as Survivor or The Apprentice.

Go to the new site and register now.

The Cringely 2010 (Not in Silicon Valley) Startup Tour

Posted in 2010 on February 8th, 2010 by Robert X. Cringely – 155 Comments

Small companies create jobs in America.

According to a recent study by the Ewing Marion Kauffman Foundation, companies less than five years old generated nearly two-thirds of the new jobs created in the U. S. in 2007. But what’s even more important is that without these startups more jobs would be lost than created, the U. S. economy would permanently shrink and America would eventually lose its superpower status, simple as that.

This is because big companies grow by increasing scale and productivity, which is to say by reducing the number of jobs per unit of sales, while startups grow by inventing cool stuff. See the difference?

The startups that most reliably become giant American corporations and creators of wealth are technology startups. Without startups to compete with or acquire, big technology companies would do almost nothing new. In the United States large companies depend on startups to explore new technologies and new markets. Startups play a particularly important role in growing jobs out of a recession. New companies produced all of the net new jobs in the U. S. from 2001-2007, and also from 1980-1983, the last big American downturn.

Why then, has U. S. economic policy been aimed almost entirely at saving large and dying industries (banks and car companies)? Because sometimes even Presidents don’t get it.

U. S. technology startups are born and die at astounding rates. Ninety-five percent of technology startups fail — ninety-five percent. With odds at 19-to-1 against success, why do entrepreneurs even bother to build these companies? Because the potential rewards are huge (Microsoft and Apple, Cisco and Intel were all startups, remember) and for real entrepreneurs there are some things even worse than failure, like boredom or being like everyone else.

American technology startups change the world all the time and are this country’s primary global advantage, though hardly anyone understands that. Encouraging technology startups is the key to keeping America competitive and prosperous, though hardly anyone does that. Technology startups succeed despite these adversities because Americans are full of ideas, startups are so darned fun to do, and they don’t have to cost that much, either — sometimes nothing at all.

Technology export sales drive the U. S. economy and technology startups drive U. S. industry, yet in this era of too-big-to-die companies hardly anyone knows about or understands this phenomenon. The experts are supposed to be the venture capitalists of Silicon Valley and Boston, but they don’t really know what they are doing. VC returns are way down for a variety of reasons mainly coming back to the same greed and stupidity we’ve been seeing at work in other financial markets.

Something needs to be done, then, to encourage America to restart itself, and I’m just the guy to try it.

Announcing the Cringely 2010 (Not in Silicon Valley) Startup Tour.

Starting next month I will be accepting from readers nominations for interesting startup companies in six general categories — biotech, energy, entertainment, information technology, materials, and transportation.  Over the course of about six weeks we will examine and discuss as a community these nominated companies of which I am hoping there will be hundreds, primarily not from Silicon Valley or any other tech hotbeds.  I’ll have some assistance in this process from the Kauffman Foundation.

Together we’ll whittle the number down to 24 then come June I will set off with my family in our RV to visit all 24.  We’ll camp in the parking lot or in the driveway of the CEO and spend a couple days at each startup, learning about the company, the people, their technology and their market.  I’ll take with me a small camera crew and we’ll produce what will begin with a summer of blogging and end with a 13-part TV reality series

That’s my plan for restarting America and I hope you’ll be along for the ride.  Look for details soon, but no nominations yet, please.

The Next White Whale

Posted in 2009 on December 29th, 2009 by Robert X. Cringely – 55 Comments

A week from now I’ll announce in this space an important project involving technology startup companies, which I feel are key to continued economic prosperity for the United States. This will be my major project for 2010 with the Moon shot following in 2011. But first I want to conduct a little experiment involving venture capitalists. How interested are they, really, in your ideas or mine? We’ll see.

This is a tough time to be a VC. Investment returns have been poor for several years. Some of this can be blamed on bad investment decisions, some on a horrific economy, and some of it comes down to what are essentially deferred returns because of the drought of Initial Public Offerings. With not many tech companies going public there are fewer VCs buying private jets.

So the VC community is chastened though not poor and this leads to a trend I’ve noticed of venture firms and their web sites suddenly seeming a lot nicer than they used to be. Nearly every firm on Sand Hill Road says it fosters entrepreneurism, says it gives more than just money (sage counsel, help in hiring, really good coffee, etc.), and offers a channel for you and me to submit our business plans right into the belly of their beast, though with nothing held confidential, of course.

I find this idea fascinating, that anyone (heck, everyone) could submit a business plan for review by some of the smartest (and not so smart) VC’s in the world. Can it really be that easy? If my idea, my technology, my business model, and my target market are all good, can I really get funded through a VC web site alone? History and conventional wisdom suggest not, but those web sites are just so darned cheery that I decided to give it a try anyway.

So last week I wrote a business plan for a real startup. People with good ideas and nowhere better to take them come through my door all the time, so I grabbed one of the better ideas and just wrote it up. The geek in my kitchen this time was supremely experienced and grounded in the real world, his idea was novel and addressed a $7 billion market growing at 30 percent per year. There were, as far as I could tell, only seven competitors, the technology seems protectable, and if any of them rip it off it should be easy to tell. Best of all there wasn’t much money required by VC standards, the development and sales cycles run in parallel, and could be measured in months, not years.

Heck of a deal: one funding stage and profitable in less than a year. This would be many a VC’s dream investment. But only if they know it exists.

I submitted the business plan last week through the very friendly web sites of two Sand Hill Road venture capital firms. One firm is venerable the other fairly new but both are among the best. If they actually read the plan I’m sure they’ll be interested, not just because it is good but because it came from me and these firms both know me. I’m not an idiot — I only play one on TV — and they know that. So the real question is whether the plan will be read at all.

I don’t really know how this vetting process works, but I imagine it must be like the stories I’ve heard about how book publishers handle unsolicited manuscripts, which pile up in corners, are occasionally thumbed through by junior editors, and periodically shoveled in a dumpster, many unread, even unopened.

That’s no way to find the next Moby Dick.

Yet good books are still published because literary agents get their stuff past that pile-from-Hell and into the hands of senior editors who actually buy books. Same with venture capital, where it usually comes down to who you know.

This should be interesting. Will the VC’s read my plan at all? Will they read and reject it? Good plans are rejected all the time. If they reject it will they bother to tell me? If they like it will they bother to tell me? And how long will all this reading and telling actually take? Days? Weeks? Months?

Of course by writing this column I’m unleveling the field a bit. Most firms will do nothing special as a result but a few may actually send someone to paw through that electronic pile of business plans looking for something from me.

I’ll keep you posted.