Category: Blogs

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.

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.

Entrepreneurship is more important than innovation

I’m in Wilmington, NC today and currently listening to someone presenting research on innovation across the state. He’s clearly done quite a bit of research on innovation and how important it is for North Carolina’s future. It’s hard to disagree with him.

That being said, how do you get more innovation to actually happen? Talking about it is good… but what next?

Having visited 35 other cities on the tech tour this year, it seems to me that everyone keeps talking about innovation as if it’s some sort of treasure hunt or silver bullet. As if talking about it will get more people to somehow do it.

Instead of talking about innovation, we should be talking about entrepreneurship. The real question for communities across the country ought to be, “why aren’t more people starting companies?”

If moneyball for startups is about investing small amounts of money across a very large number of companies and doubling down on the best of them, perhaps moneyball for cities is about getting more people to start companies and doubling down support for the best of them.

Entrepreneurship > Innovation.

Four Things Every Tech Hub Needs

Now that I’ve spent about a week in Pittsburgh, Tulsa, Taos, Los Alamos, Santa Fe and Albuquerque, it’s obvious that cities need to provide four basic things if they want to see their local tech-enabled companies to thrive:

  1. Work space. This could be in the form of a coworking space, an accelerator or an incubator – it doesn’t really matter as long as local entrepreneurs have a place to work and meet that isn’t their couch or their local coffee shop. Bonus points if it’s run by someone that knows how to build a sense of community.
  2. Event space. Every industry has groups that meet up on a regular basis, tech-enabled companies are no different. There are bound to be web design, marketing, and similar groups that will form. They might be small at first but they’ll need a place to meet.
  3. Code School. As local companies grow, hiring becomes a challenge. At first, local companies will turn to hiring remote employees and/or moving candidates from elsewhere to their HQ. Over time, it’s important for communities to develop their own local talent too – particularly adults that might not have the time or interest in going back to college to learn technology skills.
  4. Capital. Whether it’s through venture capital firms, angel groups, local banks or some other source – money’s important, especially for companies that find themselves limited by their existing cash flow.

On being the father of a little girl, spending your career analyzing instead of doing and pics or it didn’t happen.

Sep 18, 2015 • Paul Singh

You are reading an article I shared with my mailing list. If you dig it, and I hope you do, you can get articles like this one in your inbox every Friday by signing up here. 

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Happy Friday.
(Hello from beautiful Victoria, BC where I’m keynoting Tectoria later this morning and keeping my fingers crossed for a whale sighting before heading back to DC on Sunday. My free email course on public speaking starts on Tuesday — you’ve got till Monday night to signup. I hope you’ll join me.)1. “America was supposed to be better than this.” [Link] [Tweet]The first sentence just about sums this up: “The simple facts are enraging.” Look at the photo of him in cuffs and tell me that doesn’t make you sad for what we’ve become.

2. “I love being the father of a little girl. There’s not a minute of it that hasn’t been awesome.” [Link] [Tweet]When you study celebrities — TV, sports, whatever — it’s easy to forget that they’re normal people too. This piece on Anthony Bourdain is fantastic and it’s easy to see why people love him so much: he’s raw, real and authentic.

My favorite quote: “I’ve said a million times that I’d rather miss the shot than disturb the mojo,” Bourdain says. “If you’re stopping people to move a light, it fucks up the dynamic and the spontaneity. You end up with a show that looks like everybody else’s.”

3. Public Speaking for Founders & Entrepreneurs is a free 5-week email course w/ less than a week left to join. [Link] [Tweet]

Nearly 1,000 smart people have signed up for my course and it’s starting this Tuesday. My goal is to make you a more confident communicator — on-stage and in-person — over the course of 5 weeks. I hope you’ll join and share the signup page with at least one other person in your network. I’ll be closing signups at 11:59p ET this Monday and it’s completely free so you’ve got no excuse to not sign up (unless, of course, you don’t want to improve yourself).

4. “Facebook now runs three of the most popular apps on the internet.” [Link] [Tweet]Technology companies will never create the majority of jobs but what happens in the tech sector will disproportionately affect everyone else. In this case, just look at the engineer-to-user ratio and the overall number of people that use Facebook:

  • WhatsApp employs 50 engineers for it’s 900 million users.
  • Facebook is used by 1.5 billion people and Facebook Messenger is used by 700 million.

On a personal note, Facebook’s Safety Check feature came in handy after the earthquake in Chile earlier this week. It’s strange to think that we didn’t have things like this sooner.

5. “In an attempt to escape my self-imposed fate, I manifested an interest in technology.” [Link] [Tweet]

Sad, but true: “You would be amazed how often you can get away with this if you talk confidently and authoritatively and intertwine fragmented topics into a complex narrative.”

The world needs more critical thinkers and more people that aren’t afraid to provide direct, constructive feedback.

6. “As the saying goes, pics or it didn’t happen.” [Link] [Tweet]I can’t say that I’ve been in any near-death emergency so I haven’t seen this “I’m about to die” selfie thing happen. How is this a thing?

7. “I feel like I’ve spent a huge amount of my career analyzing and very little actually doing something.” [Link] [Tweet]

Unsexy businesses FTW. (Have I ever told you that story about how I helped my family buy a gas station one time? Great cash flow, shitty business and awful hours. It was a weird year.)

Reminder: you can build an interesting business without starting it yourself and without ever raising a penny from VCs. The world doesn’t need more founders but we do need more entrepreneurs.

8. “today it’s about how fast you can iterate and how much traffic you can drive.” [Link] [Tweet]

Share this with your friend that keeps coming up with ideas but never actually does anything.

9. “ambitious ideas have similar success probabilities to their less ambitious counterparts, if not higher success rates.” [Link] [Tweet]Consider this a reminder that you should be swinging for the fences, always. It’s the best way to make a difference, do interesting things and build the life you want.

10. “Nobody is going to give you more money until you can prove a lot of people love what you do.” [Link] [Tweet]This is brutally honest. (Does this stuff really happen in the UK tech scene?)

I’m coming for you

I’m on the road again: Victoria, BC, Vancouver, BC, Lincoln, NE, Madrid, SP, Halifax, NS, Detroit, MI, Lagos, NG, Chattanooga, TN (coupon code: PaulSingh) and a bunch of other interesting places.

If there’s cool stuff happening in your neck of the woods, let me know ASAP — let’s get it on the calendar, I want to see how startups are growing in your neck of the woods.

Firehose

You can get the full stream of the things I read, it’s all on Twitter — follow me: @paulsingh. Sometimes I write stuff too. You can always find me on Slack, apply to join.

Have a great weekend!
-P

P.S. If you loved this newsletter, share it with a friend. If you hated this newsletter, share it with an enemy.

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The purpose of all VC meetings, your (lack of) soft skills and learning how to speak publicly

Sep 11, 2015 • Paul Singh

You are reading an article I shared with my mailing list. If you dig it, and I hope you do, you can get articles like this one in your inbox every Friday by signing up here. 

Happy Friday.
(Hello from Durham, NC today where I’m spending the day with Chris Heivly and the Triangle Startup Factory team. Also, I’m looking for BBQ y’all.)1. “I’m starting a (free) email course on public speaking for founders and entrepreneurs.” [Link] [Tweet]Three things:

  1. You people are awesome. I asked a simple question last week to gauge interest in a public speaking course and you overwhelmed me with your thoughts. Thank you.
  2. Public Speaking for Founders and Entrepreneurs is now available — it’s a (free) 5-week email course. There’s a community component to the class so please sign up by September 21 to get in on the action. I don’t know when I’ll offer the class again so please get in before the cutoff date, I won’t be letting stragglers in after 9/21. Sign up here.
  3. Before you ask: you made this my #1 engaged tweet (and link) this week, thank you. I usually put all my own stuff down below the weekly content but, since you made this the #1 thing this week, I don’t feel awkward putting my own course at the top.

2. “if you want to change the world (or even just grow a company) you must get things done.”  [Link] [Tweet]A very wise man once told me “very few people get paid for ideas and you are probably not one of them.” (I’m looking at you, Vid.) So I invested in his company.

Pro tip: if you’re starting your personal or professional pitch with “we’re going to change the world” rather than hard facts about what you’ve already accomplished, you likely won’t.

Regardless of whether you want to make a ton of money, create a lot of jobs or change the world, you need to get things done. It’s surprising how many people forget that simple fact.

3. “AVs are the greatest force multiplier to emerge in decades for criminals and terrorists.” [Link] [Tweet]

This is a (long and) thought-provoking piece. Despite the fact that autonomous cars will likely make driving (er… riding?) safer and more economical, there are a lot pieces that still need to be figured out.

How does the police “pull over” an autonomous car? How do we prevent bad actors from using autonomous cars from carrying out “unmanned” terrorist acts?

If you’re a lawmaker, the next few years are going to be especially tricky. Good luck. (How does one get into politics and lawmaking any way? I digress.)

4. “We may start companies with our friends, but we don’t become friends with our co-workers.” [Link] [Tweet]This is fascinating: “Focusing our friendship efforts outside work isn’t the norm around the world. In surveys across three countries, Americans reported inviting 32 percent of their closest colleagues to their homes, compared with 66 percent in Poland and 71 percent in India. Americans have gone on vacation with 6 percent of their closest co-workers, versus 25 percent in Poland and 45 percent in India.”

For my Indian friends: make me dinner and take me on vacation with you. (I assume you’re paying, right?)

5. “eSports is big, bigger than you imagine.” [Link] [Tweet]

It’s been a few years since I’ve seen Chris in person (back when he was working on Startup Digest, I believe) but I love these ecosystem maps he’s pulling together. Very useful.

6. “Talent is universal, even if opportunity is not.” [Link] [Tweet]Ugh. Let’s blame VCs for the lack of capital outside Silicon Valley / NYC. No need to consider that those founders may not be competing at a high enough level or that LPs may have no interest in those markets.

<soapbox>

Look, maybe investors are to blame — but only partly. Founders everywhere need to step their game up and learn to communicate more effectively and broadly. LPs need to understand that companies can emerge from anywhere.

Because here’s the thing:

  1. VCs, by definition, are managing LP money. If the LP doesn’t have an appetite for investing outside the Valley, you can bet that the VC won’t either. Call it the tail wagging the dog or call it the reality of venture capital.
  2. Founders are quick to blame VCs for not “getting” their amazing business — it’s always easy to blame the other party. How about really understanding the market you’re competing in? How about learning how to communicate and inspire other people? More fundamentally, how about building a business that no one can ignore?

Everyone needs to step up their game: angels, accelerators, VCs, LPs and founders.Everyone.

</soapbox>

7. “Trump isn’t exactly self-made—he inherited substantial wealth from his father—but he is definitely self-invented.” [Link] [Tweet]I hate to admit that I kind of respect Trump: the dude is a marketing and media machine. You couldn’t pay for the amount of coverage he’s getting these days and, in a presidential election, that’s a pretty important thing.

8. “the soft-skills millenials don’t have may be absent because their first job out of college is their first job ever.” [Link] [Tweet]”Good social skills aren’t just about getting along with your boss or peers, it is communicating and connecting with people of all skills levels and backgrounds.” This.

If you’re in high school or college, do whatever it takes to join a venture-funded company and try to do as many jobs internally as they’ll allow you. After six months, you’ll likely have experienced more than your peers will see in two years of a “regular” job.

9. “It has become the beginning of a long goodbye.” [Link] [Tweet]Life is beautiful.

10. “The purpose of all VC meetings is to get another meeting.” [Link] [Tweet]You kids probably don’t remember the days when the VC industry was opaque. Transparency (and the Internet) FTW! (I fear that I may be turning into a bit of a curmudgeon at my age. The mid-thirties are a bitch.)

I’m coming for you

I’m on the road again: Durham, NC, Victoria, BC, Vancouver, BC, Lincoln, NE, Madrid, SP, Lagos, NG, Chattanooga, TN (coupon code: PaulSingh) and a bunch of other interesting places.

If there’s cool stuff happening in your neck of the woods, let me know ASAP — let’s get it on the calendar, I want to see how startups are growing in your neck of the woods.

Firehose

You can get the full stream of the things I read, it’s all on Twitter — follow me: @paulsingh. Sometimes I write stuff too. You can always find me on Slack, apply to join.

Have a great weekend!
-P

P.S. If you loved this newsletter, share it with a friend. If you hated this newsletter, share it with an enemy.

Like this newsletter? Want to spread the word?
Tell your friends and followers to sign up.

 

Uncomfortable Conversations About Valuations

Aug 11, 2015 • Paul Singh

Everyone has an opinion on today’s private market valuations. Everyone.The way I see it, there are only three options for investors at this point:

  1. Stop investing. This probably feels like the easiest option but, like the lottery, you won’t get a chance to win if you never play.
  2. Complain publicly. This is the worst thing you can possibly do. Your tweets might get a few clicks but, ultimately, you’ll alienate yourself from founders and never get access to the very best investment opportunities in the future.
  3. Solve for whatever concerns you most. Valuations are just one part of the term sheet, there are plenty of other levers to be pulled that might alleviate your concerns.

The particularly exciting thing about private marketing investing is that your downside risk is capped to 1X your investment but, in theory, your upside opportunity could be nearly infinite. It’s important to remember that when you find yourself tweeting/retweeting about valuations alone.