http://www.ovp.com Thu, 29 Jul 2010 22:33:03 +0100 FeedCreator 1.7.2 http://www.ovp.com/images/M_images/joomla_rss.png http://www.ovp.com http://www.ovp.com/blog/entrepreneurship/seven-reasons-to-remove-a-ceo.html Here is a surefire bet: Gather together a bunch of entrepreneurs to talk about venture capitalists, and before long the conversation will turn to the issue of control. Here's the common refrain: If we take VC money, the next thing you know, they'll be in control, and we'll be out on our ear. Now, try the reverse. Gather a bunch of VCs, and before long you'll hear something like this: If we invest in them and we don't have the ability to take control, these young hotshots may run right over the edge of the cliff and take all our money with them. The problem, of course, stems from the following: Entrepreneurs often have mixed goals in starting a business. They want to deliver on a product vision, want to grow a major enterprise and make money, and also want to be the boss. Venture capitalists have only one goal: To make money for their investors and themselves. Sometimes, if the company gets off track and management doesn't seem able to fix it quickly, VCs want to bring in people who they believe can. Blog - Entrepreneurship Tue, 27 Jul 2010 16:19:17 +0100 http://www.ovp.com/blog/trends/how-to-wow-a-venture-capitalist-in-7-slides.html We've seen all sorts of presentations from startups over the years. But none as succinct, yet as effective as one we saw a few days ago. The Seattle company in question is one that pitched us a few years ago. At the time, we loved the team, but thought they seemed to be remarkably unfocused. So, rather than have our money burned in a bumping into trees exercise, we passed. Now they were back - with laser focus - and it showed. Before the presentation started, the CEO told us he only brought seven slides. And oh, by the way, they were all in 30 point type! My immediate reaction was, This guy must have his stuff together! Rather than death by PowerPoint, he was planning to subject us to a real discussion, where the knowledge of the management team was the foundation, not the slides. And the goal was interaction with potential investors, not to baffle us with BS. Blog - Trends Mon, 12 Jul 2010 14:23:04 +0100 http://www.ovp.com/blog/entrepreneurship/its-a-cluster-.html How's that for a direct quote (modified for family viewing) from a recent due diligence call I made? And yes, when the words hit my ears I broke out laughing so loudly that Linda in the next office stuck her head in my door to see what had happened. This is one of the joys of doing due diligence on a new deal. It's very much in the Forrest Gump box of chocolates model - you never know what you're going to get. But sometimes, just sometimes, you get far more than you expect in just a few words. In this case, I was probing around with an executive on our Technology Advisory Group who was getting his first exposure to the company in question. It turns out his firm had created an in-house tool to handle some of the functionality the startup was offering. And while they were getting by with their proprietary solution, his shall we say candid assessment of how he felt about the internal program (that his team had to create, support, and enhance) told me all I needed to know about whether this was indeed a pain point - and a major account opportunity for the startup, whether we invested or not. Blog - Entrepreneurship Thu, 10 Jun 2010 18:34:00 +0100 http://www.ovp.com/blog/entrepreneurship/vitamin-aspirin-or-vaccine.html Prolifiq (http://www.prolifiq.net/corp/)) that did a very nice, crisp job when they presented to my partnership in describing their value proposition. With their permission, I thought I'd pass along a framework they used in case it is helpful to any of you. They laid out the possible reasons customers might buy a product such as theirs as vitamin, aspirin, or vaccine. Is it something to help you do better (a vitamin), something to take away current pain (an aspirin), or something to avoid serious pain later (a vaccine)? In many ways, this mirrors the way we think about how compelling a start-up may be on the nice to have - have to have continuum, but with more specific descriptions. While they didn't make the point explicitly, it is clear that most of the time people will pay more for aspirin than for vitamins, and that if the risk of future pain is high enough, may pay the most for vaccines. I must admit, our bias has always been to invest in companies more on the aspirin dimension, since corporate budgets seem to flow better to current pain, than potential pain or potential gain. However, in business segments where regulatory risk rears its head, a vaccine may be just as powerful to dislodge budget dollars. Now, given how clever the Prolifiq team is, they managed to make the case (still to be verified during my diligence calls) that they are essentially all three, depending on the customer's need set. Nice work if you can get it! Less Filling. Tastes Great! Gives a Great Buzz! For most start-ups, your products probably hit just one of the dimensions. But, as long as you understand which one is your primary value, you can focus on how that flavor of budget dollars gets released, and how you get to stand at the head of the line when they do. Then, if you can articulate that to your friendly local VC, you'll have a much better chance of convincing us you are in the have to have category - regardless of vitamin, aspirin or vaccine. Blog - Entrepreneurship Fri, 28 May 2010 21:26:42 +0100