Author: Paul Singh

Having a job is riskier than you think.

“People think entrepreneurship is risky. The thing is, it’s much riskier to have a job.”

At the time, Andrew Myers was driving us back to Fort Wayne, IN after a quick visit to Warsaw, IN when we started talking about the common concerns from people when they think about what it means to be an entrepreneur.

Now that we’re just about to visit our 40th city this year, I still find it odd that community leaders continue to talk about innovation while local residents worry more about entrepreneurship — or the risks that come with it. This gap is yet-another-reminder that innovation and entrepreneurship aren’t the same. If we want people to innovate, we need them to make the leap into entrepreneurship first.

If you drive around North America, you’ll quickly learn that most people are concerned about losing their jobs. They may not say it when you first meet them but this is the kind of thing that comes up when you actually live someplace for a week at a time and see them at the local diner for breakfast over the course of a full week.

At the same time, many of these same people express fear when asked what they would do if they became an entrepreneur. They worry that their boss won’t like them working on the side, they wonder whether they have enough education or they share stories about how someone they once knew failed at something.

Here’s the thing: the best entrepreneurs take the least risky bets.

They’ll figure out a way to keep their day job for a while. They’ll find ways to cut their personal burn rates. They’ll spend any free second they have looking for a new customer.

The best entrepreneurs know that sales solves everything. They figure it out.

If you choose to stay (and you’re happy) in your cubicle, do yourself a favor and make sure that you’re on the revenue-producing side of your company. If something goes sideways, the people that make the company money are the least likely to get cut first.

For everyone else, just start something.

For most of our parents, success was a function of hard work over a period of a long time. For our generation, success is a function of the number of things you try.

If you want to reduce the risk in your life, start to think more entrepreneurially. Start to take control of your own future.

Fear drives me and, if you want control of your own future, it probably ought to drive you too.

Self-driving beer deliveries, the trade-offs in VC and how to understand the Valley

Happy Friday.

It’s been a busy (and cold) week here in Fort Wayne, IN. Aside from meeting entrepreneurs, investors and the rest of the tech community, we’re heavy into the 2017 Tech Tour planning. Yay, spreadsheets (and Asana)! If you’re an investor, executive or community leader that would like to visit other cities with us, please apply to join — it’ll be fun, I promise.

  1. Uber has quietly launched its own ‘Uber for trucking’ marketplace called Uber Freight [Link] [Tweet]

    They deliver 45,000 cans of beer via a self-driving 18-wheeler and launch a marketplace for freight in the same week. Meanwhile, I can barely stay on top of my email.

The way we think about the future is two things: marketplace and automation. And that will apply on the consumer side and the freight side.

2. “the distance will increase 1000km and the flight will be 1-3 hours shorter than the polar route.” [Link] [Tweet]

Long haul flights have always been my favorite — don’t ask me why, I just love them.

3. “He’s in over his head and he’s proudly done zero to gain any relevant expertise.” [Link] [Tweet]

And just like that, you’ve got one, single, unifying theory that explains everything about Trump, the debates, and this election: Donald Trump is terrified of actually becoming president. And he hates Hillary because she isn’t.

4. “VC is not about making the best analysis. VC is a job where trade-offs are kings.” [Link] [Tweet]

Investing in companies outside of existing tech hubs is hard. In addition to vetting the founders, the business and everything else in between, you’re trying to gauge the founding team’s ability to raise even more external capital in the future.

5. “To understand the serendipity of the Valley you need to get to the people.” [Link] [Tweet]

It’s a desert for those who don’t know anyone and a monsoon for the networked. A place where meritocracy has a shot vs. street smarts and monopolizing darwinism.

6. “China has now overtaken the U.S. to become the largest market in the world for App Store revenue” [Link] [Tweet]

In case you’re looking for more customers, “China will drive the largest absolute revenue growth for any country by 2020.”

7. “I remind myself to be kind and see the potential in people. Give them a break.” [Link] [Tweet]

Yep.

8. “Being believable isn’t just convincing people you can win, it’s convincing them that they want you to win.” [Link] [Tweet]

The RIBS method is pretty much the best. If you want to convince anyone of anything, it needs to be Relevant, Inevitable, Believable and Simple.

9. “Every millennial should be planning for a 100-year horizon.” [Link] [Tweet]

You don’t think you’re actually going to retire anymore, do you?

10. “The reason is that we somehow feel we have to be different people in different situations. But that’s a lie.” [Link] [Tweet]

Gary Vaynerchuk always advocates for playing to your strengths instead of improving your weaknesses. I love that.

Firehose

You can get the full stream of the things I read, it’s all on Twitter — follow me: @paulsingh.

-P

We need to do more about the technology skills gap.

“I don’t even know how to use my own damn email,” says the Mayor of a city I visited on the tech tour this year.

It would be easy to publicly shame him for admitting that he still hasn’t quite figured out something that most of us take for granted but, in his defense, he also asked me to bring a few investors to town for a week and allowed me to park my Airstream right in the middle of his downtown business district. He means well and he’s trying to make things right for his people.

His city, like many cities around the US & Canada, is faced with an impending problem: one of the biggest factories in town is planning to downsize and nearly 1,000 local jobs will be eliminated within the next year. He and his team now recognize that bringing another factory to town — particularly one that can re-employ those 1,000 people — is near impossible.

He needs to find ways to provide training for these people and the tech community hasn’t made that easy.

On one extreme, local colleges and universities have created certificates, associate’s degrees and bachelor’s degrees, but these cost money and not everyone has the months or years required.

On the other extreme, we’ve created code bootcamps for adults that want to enter the software development industry, but those cost money and not everyone needs to code.

Middle America need something else.

Middle America needs a basic on-ramp into the technology world for adults coming out of decades-long careers in other industries.

Two suggestions:

  • If you’re an entrepreneur in this space, you could build a huge business on technology skills training across Middle America. Go do it.
  • If you’re a city leader, consider incentivizing your adult constituents to seek out and obtain technology skills.
  • If you’re attending any tech events in your city — no matter how big, small or sophisticated — take one non-tech friend with you to every event. Collisions matter.

Same pitch, different city.

The tech tour, sometimes, feels like Groundhog Day.

In every city, a local accelerator / incubator director talks about their “great” companies. The local entrepreneurs all complain about the lack of capital. Everyone else just wants to figure out what startups actually do.

To be honest, it’s hard not to become a little cynical after a while.

If I had a magic wand (and unlimited cash), I’d force at least one entrepreneur, one investor and one community leader to come with me to at least one other city on the tech tour.

Only then would they realize that it really is the same everywhere else. It’s just as hard, just as noisy and just as frustrating for everyone else.

I’ve learned something else along the tour this year: it’s so easy for everyone to claim that it’s easier elsewhere. Mostly because it absolves the individual for taking ownership of their own problems.

If you’re trying to build a company, 99% of what you need to know is available via Google and the last 1% is available via email. Bonus points if you get on a plane (or come with us).

If you’re trying to build a community, 99% of the challenges you’re facing have been handled by your peer in another city. Email them. Better yet, get on a plane (or come with us).

If you’re just trying to figure out what a tech community looks like, it’s never been easier to visit coworking offices in other cities. Again, get on a plane (or come with us).

If I could figure out some way to systematically connect entrepreneurs and community builders with their peers across North America, I’m fully convinced that they would all have no other choice than to raise the bar for themselves.

How startups will transform local economies, where 75% of investor dollars go and how to think about your career.

Happy Friday.

We’re on our way to Ft Wayne, IN for the week — if you’re nearby, please come hang with us. As for 2017, we’ve started to book stops in Sioux Falls, Lubbock, Oklahoma City and a few others — let us know if you’d like to bring us to your town. If you’re an investor, executive or community leader that would like to visit other cities with us, please apply to join — it’ll be fun, I promise.

It’s a cool week here in DC and, to be honest, it’s nice to be home for once. That being said, we’re starting to lock in stops for the 2017 tech tour so let me know if you’re interested in letting us pull the Airstream to your city and hang out for a bit.

  1. “You’re busy, so I’ll keep this quick.” [Link] [Tweet]

There is an inverse correlation between the length of your requests and the likelihood that you’ll get what you want. Keep everything short.

2. “Apple is the world’s largest owner of CNC milling machines and swiss style lathes.” [Link] [Tweet]

Apple operates acres and acres of CNC machines to meet the demand of 1M phones per day.

Between data centers that serve the information we see every day and the facilities that actually make the things that we carry around in our pockets every day, it’s fascinating to realize how little we ever think about them.

3. “75% of the investment $$ went into graduates of four programs: @ycombinator, @techstars, @500Startups & @angelpad.” [Link] [Tweet]

If you’re applying to an accelerator and can get into one of the four above, do it — no matter what. If you don’t make the cut, accept the best offer you can get and work your ass off.

4. You guys, how good is SNL going to be this weekend? [Tweet]

Ezra Klein nails it.

5. “My thesis is that five $10 million companies could transform our economy.” [Link] [Tweet]

Yep.

Talent and ambition are equally distributed. Functional expertise and venture capital are not. This is why we’re doing the tech tour: it’s about bringing functional expertise and venture capital to cities that don’t normally receive it.

6. “Investors are NOT funding a startup for it to survive, but rather for it to thrive.” [Link] [Tweet]

A trick question I like to ask companies that I’ve invested in: “so, how much runway do you have now?”

At the earliest stage of the company, the only correct answer is related to the number of iterations you’re able to try before running out of cash.

7. “The problem … is we think technology can only be new.” [Link] [Tweet]

Let’s not confuse innovation with technology:

Old planes are familiar, reliable, and trusted, but they require constant attention to keep in working order. The work of maintenance is essential, but invisible, the costs recorded as “depreciation” or “overhead.” Politicians and CEOs scramble to claim credit for their investments in R&D, but technicians, mechanics, and janitors keep the world running. By confusing the history of innovation with the history of technology, Edgerton argues, we not only miss this labor, but also we misunderstand the work of scientists and engineers.

8. “VCs have a portfolio, entrepreneurs get one shot (at a time)” [Link] [Tweet]

Read this article over your next cup of coffee, it’s a fascinating study. As they say, amount of capital raised is a vanity metric.

9. “The people in SF think you’re not as good, because if you were, you would already live in SF.” [Link] [Tweet]

This attitude, primarily within the SF tech community, was the primary reason I moved back to DC. It felt too disconnected from the rest of the world.

10. “I’m worried too many millennials look at our work — as just work.” [Link] [Tweet]

Cal Newport, I believe, once said that being successful was about being good at something, that you like doing and that a lot of other people want.

I think the real problem here is that too many millennials have accepted jobs because of the money rather than the career potential. You can always buy the BMW later, but you can’t get your earliest professional years back.

Firehose

You can get the full stream of the things I read, it’s all on Twitter — follow me: @paulsingh.

-P

Fear drives me.

There, I said it.

I’m worried all the time. I know the venture industry’s changing. I know startups keep changing. I know that we can’t all just sit in DC, San Francisco or NYC anymore. On top of that all, I know there’s someone else out there that’s just a little bit hungrier than me. So I focus on doing the things that no one else is doing… yet… (e.g., hauling an Airstream around North America) to try to stay one step ahead of the curve.

In many ways, the most successful founders I’ve met tend to share a similar mindset: they’re more self-aware and more relentlessly resourceful. They use those two traits to speed up their execution personally and professionally.

A sense of urgency is the most important thing we can bring to any entrepreneur. The challenge, however, is that each entrepreneur needs slightly different inputs to drive that urgency. For me, it’s that constant fear. For others, it’s a chip on their shoulder. Everyone’s different, you get it.

Every city I’ve visited seems to have resources for people that might want to start something. Sometimes they also have resources for people that have already started something. What’s lacking are resources for importing urgency to a city’s entrepreneurs.

I’ve said before that I’m not sure that entrepreneurship can be taught but I do know that it can be learned. I think the same thing goes for that sense of urgency. If we could get more entrepreneurs — regardless of whether they want to build a local business or a venture-scaled business — to meet and know their peers, I’m convinced it would only speed up their path to success.

Never judge the idea.

If I’ve learned anything as an investor over the past few years, it’s that the companies that end up creating the most jobs (and returning the most money) almost always look like products at the beginning.

If I find myself in a meeting where the founder is talking about the product for more than 50% of the allotted time, something’s wrong.

It could be that the founder is overly focused on the product instead of the growth of the product. It could be that I don’t understand enough about the market itself (in which case, I shouldn’t be investing in it anyway). Or it could be something else entirely.

This is exactly why traction matters and why founders should lead with it: traction is the only leading indicator that a product might eventually turn into a company.

The key idea here is to recognize that judging ideas isn’t worth anyone’s time. Especially when we’re talking about companies that can acquire their customers online and/or service their customers online.

Moneyball for Cities

Trailing indicators are a terrible way to measure the future potential of a city’s tech scene. Aggregating the numbers make these trailing indicators even worse (e.g., aggregate capital raised, aggregate revenue, aggregate number of employees).

If you want to make your city better, start something. If you want to help make your city better, invest in programs and events that help more people start something. This is why, at the local level, we ought to be talking more about entrepreneurship than innovation.

With roughly 470 first-time venture firms trying to raise a fund, the overall micro-VC trend doesn’t appear to be slowing. Simultaneously, the global interest in startups continues to grow. Bringing it all together is the growing sentiment that Silicon Valley isn’t the only place to start and grow tech companies anymore.

The point is that all the signs are pointing towards the economic growth of smaller cities and, given what I’ve seen on the tech tour this year, the best way to predict which cities are poised to become local tech hubs is to track the number of new businesses (read: startups) created over time.

The best way to gauge the potential of a city’s future tech scene is to track the number of business license filings. This is probably the best leading indicator of a city’s “openness” to entrepreneurship over the long term.

Moneyball for cities is all about creating more startups and then doubling-down on those companies by creating more resources for the companies that show actual traction. Ultimately, creating ten new $1M/year companies or one new $10M would drastically transform local economies and the only predictable way to ensure that happens is to get more entrepreneurs to step up to the plate.

It’s the same everywhere.

I’m hiding in the corner of a Starbucks in Dupont Circle this morning when someone walks up to me.

Her: “Are you the same Paul Singh that’s been driving around in an Airstream? I met you when you came through Tulsa and parked your trailer in front of 36 Degrees North.”

Me: “Well, yes. Also, fun fact, I survived a tornado that same week! Well, actually, the tornado was three blocks away but I’m pretty sure that still counts.”

It turns out that she and her husband had moved to DC for grad school after our visit to Tulsa.

During the conversation, we got into the topic of how Tulsa’s tech scene compared to other places I’d been on the tour through 2016.

In short, it’s pretty much the same everywhere.

Most cities of less than 300,000 people seem to only have one coworking space. Maybe they have one angel group. If they’re lucky, they’ve got one code school.

Other than that, they’re all spread thin just trying to keep things afloat.

The local entrepreneurs are just trying to build their businesses. The local elected officials are trying to figure out what tech companies actually do. The local community leaders are trying to figure out how to get things organized — and how to pay for it all.

If you want to level up, doing more is just the baseline. It’s important to hop on an airplane (or get in the car) and go visit other places. Go meet your peers in similar cities. It’s really that simple.

I’m not sure that entrepreneurship can be taught but I do know that it can be learned.

Whether you’re trying to build a company or a community, the best thing you could do is visit other places and talk to as many people as you can. Figure out what’s working, what’s not working and think about how to apply that to your own city. Don’t forget to give back a little bit too.

Pro tip: just go hang out at coworking spaces in other cities. You have no excuse anymore. Better yet, join us on the North American Tech Tour through the US & Canada.

What startups should actually celebrate, why non-tech people keep talking about manufacturing jobs & the 10X mentality.

Happy Friday.

It’s a cool week here in DC and, to be honest, it’s nice to be home for once. That being said, we’re starting to lock in stops for the 2017 tech tour so let me know if you’re interested in letting us pull the Airstream to your city and hang out for a bit.

In other news, we finally got around to updating the website. What do you think? 

  1. “Don’t blame the playa, blame the game.” [Link] [Tweet]

It’s probably fair to say that most investors don’t appreciate (or remember?) the struggle that entrepreneurs face when trying to get their business off the ground.

It’s also probably fair to say that most entrepreneurs spend exactly zero minutes trying to understand how investors think or how the distribution of returns typically work for any set of investments.

2. “The simplest explanation for my departure is money, or, more accurately, the lack of it.” [Link] [Tweet]

This is one of the best written pieces I’ve ever read on the topic of moving from the “big city” to someplace in the Midwest.

I think it’s harder to start your career outside of certain larger cities but, once you’ve gained a bit of experience, there’s no reason why you can’t move to someplace more affordable to continue your career.

3. “There are basically four strategies that a couple can practice at a restaurant.” [Link] [Tweet]

In case you’re wondering:

A communist economy is a terrible idea. A communist dinner table, on the other hand, truly is a bounteous paradise.

4. “Never reduce a target. Instead, increase actions.” [Link] [Tweet]

This is your pep talk for the week.

5. “You should celebrate any day that you don’t have to sell off another part of your company.” [Link] [Tweet]

This entire article reads like satire until you start recognizing that uncomfortable feeling inside you that says “this is all so true.”

6. “Asking for advice is lazy is because you can’t build a business or career or a life on everybody else’s opinions.” [Link] [Tweet]

I recorded this interview while visiting Syracuse on the tech tour earlier this year. It looks a lot more coherent in text than it felt while I was rambling across the table to the reporter.

7. “If you want to survive, don’t just build a network. You have to build a hive, and eventually a hivemind.” [Link] [Tweet]

As we begin locking in the 2017 tech tour stops, I’ve been thinking quite a lot about this same idea. Stay tuned, I think I have an idea…

8. “in early-stage, he needs to see 5x, but most funds are just gunning for 3x.” [Link] [Tweet]

If you’re looking for a quick pulse of what GPs and LPs are thinking these days, this is for you.

9. “there can be no revival of American manufacturing, because there has been no collapse.” [Link] [Tweet]

 

If you consider yourself part of the tech community, you’re not surprised by the rise of coworking spaces, accelerators and code schools all over the country.

If you’re trying to help build your tech community, however, it’s worth reading this piece to better understand why our elected leaders hang on to manufacturing and other “low tech” jobs.

Pro tip: when you head to your next tech event, try to convince one of your “non-tech” friends to join you. That’s the best way to reduce the divide between the tech and non-tech communities.

10. “What if we came out clean and acknowledged that we’re not making enough money?” [Link] [Tweet]

Less grinfucking, more real talk. Kthx.

Firehose

You can get the full stream of the things I read, it’s all on Twitter — follow me: @paulsingh. You can always find me (and the rest of the Results Junkies community) in Slack, apply to join.

-P