Archive for March, 2008|Monthly archive page

Harvard Pitching & DEKA

etuk.jpgWeek7 Mar 3-7: On Monday 3rd we had a lecture by Ntiedo Etuk who is Co-Founder, Chairman and CEO of Tabula Digita. Tabula Digita is an educational gaming company focused on delivering innovative and effective educational games to students and institutions. The games have all of the action adventure fun associated with mainstream games while simultaneously providing an efficient learning environment to better prepare students for high stakes exams. Tabula Digita’s games can be used as stand alone teaching programs or they can be used to support and enhance conventional teaching methods and materials. Tabula Digita’s experiential learning systems are embedded in a stunning first person, action adventure video game format which Ntiedo demonstrated for the group. The games were very impressive and something which would prove beneficial to educational institutions without doubt. Its just a matter of how fast Tabula Digita can convince State educational boards that this is worth paying for, and get past the usual red tape.

On Monday evening the Global Scholars were invited to partake in a pitching competition against Harvard students. Angelo, George, Helena and I put ourselves forward to compete against 4 Harvard business and tech students. The challenge was an elevator or 1 minute pitch, which is definitely harder in my opinion than a standard non-restricted pitch. Angelo, our very own rocket scientist, won the competition, and a $200 prize!

dean_ibot.jpgdeka.gifOn Tuesday 4th we headed to Manchester New Hampshire to visit DEKA. During our time here we had Dean Kamen, the genius behind DEKA’s creation, answering questions and guiding us around his research labs. DEKA Research & Development Corporation is focused on the development of radical new technologies that span a diverse set of applications. copy-of-img_5420.jpgDEKA’s technologies, and the products which incorporate these technologies, are improving lives around the world. One example of this is the iBOT, a sophisticated mobility aid for the physically challenged, designed to climb stairs and traverse uneven terrain. The iBOT uses self-balancing technology, allowing users to better operate in a world architected for those with balance. During our tour of segway_small.jpgDEKA’s robotics lab Dean demo’ed the iBOT for us and allowed each of us to test it for ourselves – it truly is an amazing piece of engineering. Another of DEKA’s more notable and public products is the prosthetic arm (video or story) they’ve developed for Iraq veteran amputees to resume a semblance of a normal life. In case DEKA isn’t ringing any bells for you yet, they have also invented the infamous Segway personal transporter.

It was a privilege to have spent the day with Dean, he had invaluable advice to share with us regards our own entrepprises going forward. “Succeed by raising the bar, not by forcing others under it” was a business approach he reiterated a few times. He had a few things to say about VCs that, to put it politely, would have no place on a family website! He talked a lot about Richard Feynman, who is one of my idols, so it was intriguing to hear his opinions on the “citizen scientist”, which Feynman referred to himself as. He highly recommended his book “Tips on Physics”.Dean shared various anecdotes with us, of which his experience of college is the funniest. He basically treated the entire faculty at uni as his personal tutors. In this way he skipped class and simply visited lecturers at their offices to chat about what interested him and what he needed to know for his various projects!! In general the attitude in DEKA appears to be very liberal, there’s no forced hierarchy which knocks ideas as they arise from the shop floor, no matter how crazy they seem initially. “We fund the success of our gizmos through the success of our formal projects”. “Everybody’s allowed to have dumb ideas!” Just a couple of insightful quotes I thought worth sharing. He talked a little about always striving to do the impossible and achieving market dominance through their ability to continually do exactly that. Also he emphasised that with every project they aim to always outperform and over-achieve on expectations.

first_robotics.jpg Following this we had some time in the evening to visit another of Dean’s projects – First Robotics. FIRST Robotics Competition (FRC) is a unique varsity sport help high-school-aged young people discover how interesting and rewarding the life of engineers and researchers can be. FRC challenges teams of young people and their mentors to solve a common problem in a six-week timeframe using a standard “kit of parts” and a common set of rules. Teams build robots from the parts and enter them in competitions designed by Dean, Dr. Woodie Flowers, and a committee of engineers and other professionals. Dean encouraged all the global scholars to get involved with the mission which FRC encapsulates – to encourage young second level students to realise the potential in engineering and research careers, through mentoring, volunteering and coaching.

Advertisements

Social Entrep’ship Conf @HBS

herbie_hancock.jpgWeek 6 end: Mar 1-2: To kick back after a busy week we went to Harvard’s 23rd annual ‘Cultural Rhythms’ show, which celebrates the University’s rich cultural and ethnic diversity by showcasing the talents of over 40 student organisations. The students and faculty of the Harvard Foundation nominate an outstanding American artist to be honoured at the show as Cultural Artist of the Year. This year Herbie Hancock was presented with this award. The mix of talent was impressive, from Korean drummers to Peruvian dancers! There was even some step dancing from Harvard’s Irish Culture Society!

nnegroponte.jpgOn Sunday Owen and I attended the 2008 Social Enterprise Conference at Harvard Business School. A quick look at the schedule on the website shows how diverse the talks were. They ranged from using ICT for humanitarian responses, to micro-financing, to innovative solutions for homelessness. The high point of the day for me was Nicholas Negroponte’s keynote speech. He is the founder of the MIT Media Lab which is a world leader in media innovation, but more notably he is founder of the One laptop Per Child (OLPC) social welfare organization. OLPC manufactures XO-1 which is an inexpensive laptop computer intended to be distributed to children in developing countries around the world, to provide them with access to knowledge, and opportunities to “explore, experiment and express themselves” (constructionist learning).

olpc-crank.jpgNicolas mentioned some background information on the project, including that it was first thought of in 1968! He alluded quite a bit to the influence Marvin Minsky and Seymour Papert had on the origins of the work in general. In 1999 he trialled a project in a school in Cambodia which provided a laptop to every 3-4 children. The children involved brought their laptops home not only to show to family and friends but because it provided their only source of light during the night! He recounted with embarrassment the initial prototype of XO-1 which included a wind up crank! The antennae on the laptop enable line of sight connections up to 2KM. Uruguay was the first country to place an order, which was quickly followed by Peru. Nicolas recounted walking into a Uruguayan cabinet meeting at which all the ministers were using XO-1s, which obviously appeared quite funny, given that the form-factor was designed for primary level kids!! XO-1 was designed with the aim of encouraging kids to actually open up the device and play with the hardware, which runs pretty much 100% contrary to traditional laptop manufacturers’ warranty requirements!

olpc-xo-1.jpgAn important point he made was regards the adoption/integration of upgrades and updates for XO-1’s hardware & software. Negroponte emphasised that it was more important for the price of the device to drop as new technology appears rather than incorporating this new tech and keeping prices unnecessarily high. The current price is $188, but the goal is to reach $100 in 2008. Instead wikis will be utilised to distribute free software, text books and various learning materials. Nicolas discussed some of the issues OLPC has had with Intel, which some may be aware of. It appears everyone’s’ favourite processor manufacturer doesn’t have much of a vested interest in the success of a project of this nature, no matter how altruistic its agenda appears. He mentioned some examples of how Intel intervened, hindered and collapsed negotiations with various governments of developing countries, during the initial stages of OLPC. This is obviously as a result of the use of AMD processors in the XO-1. It seems slightly childish that Intel would react so arrogantly. One result of their interventions with the government of OLPC’s first target country, is that about 60,000 children got Intel produced laptops, rather than 1,000,000 OLPC XO-1s. Check out this short article on Intel & OLPC. In my opinion, Intel have done themselves no favours whatsoever with this idiotic stance.

psp-solar.jpg I also managed to attend a couple of other talks, including one on ‘Innovative Solutions for Homelessness’ and another on the use of ICTs in providing humanitarian responses. I bumped into one of the founders of a small but very interesting project called Practical Small Projects. PSP facilitates the implementation of practical projects that require minimal financial and environmental resources, but have maximum impact and results in the developing world. Specifically they have installed numerous solar panels in Mali. Not only did they fund this, but more importantly they provided training to locals on how to service these units and also on how to build solar panels themselves! Take a look; it really is a great example of how a small but dedicated team can make a big difference with few resources.

Baltic Boston

rickhutley.jpgWeek 6: 25-29 Feb: After the eventful weekend with Peter Davies it was time to head for Boston. But before departing on Tuesday morning I organised a lunch meeting with my internship supervisor at Cisco’s IBSG group, Rick Hutley, who is Global Head of the Innovations Team. Atfer lunch Rick brought me to Cisco City in San Jose. I couldn’t believe how immense their campus is – there’s something like 60 large building along one stretch of road! I got to meet David Evans and some other members of IBSG. I also got some insight into one of the groups projects – The Connected Bus. Dave recommended a few books for me to read:
– “Blink: The Power of Thinking Without Thinking”, by Malcolm Gladwell
– “The Wisdom of Cowds“, by James Surowiecki
– “The Tipping Point: How Little Things Can Make a Big Difference”, by Malcolm Gladwell

mit.jpgOn Tuesday we arrived in Boston and acclimatised quickly before a busy week commenced at Harvard and MIT. On Thursday 28th we went to MIT’s Entrepreneurship Center. Bill Aulet who presented to the global scholars in Kansas City during week 3 hosted us at MIT. Bill gave us a presentation on Business Planning which addressed every angle from writing an initial plan to various types of pitching them. Regards altruistic business approaches Bill suggested harvard.jpgthat “if you want to do good, do well first!” He also gave us a template for examining the value of a business proposition – which coincidentally was quite similar to that described to me previously by David Perry. Basically this consisted of analysing 5+ aspects of the business based on the opportunities and risks associated with each, including: Market (e.g. size), Execution (e.g. team, plan), Sustainable Competitive Advantage (value-add, gross margin %), Financials (e.g. ROI), Others/Misc (e.g. ethicaly, political). One very interesting statistic Bill quoted was that startups are increasingly likely to be successful for each member added to the team up to a total of 5, when the chance of success decreases again! regards business plans, he advised us to ask ourselves the following insightful questions before dedicating ourselves to a startup:
– Does it convince you?
– Am you happy spending the next 5-7 years working on the project?
– Does it convince your potential co-founders, family, customers?
– Can you explain it to your mother?!

ideo_logo.gif Bill introduced to IDEO, a design consultancy based in Palo Alto, California, that helps design products, services, environments, and digital experiences. In addition IDEO is reknown for its unique approach to innovation. In 2000, the firm was the subject of the “Deep Dive” episode of ABC’s Nightline; they redesigned a shopping cart in five days. Bill showed us a recording of this show and based a very interesting discussion on innovation around it. A couple of points to come from the discussion: 1) that IDEO’s appraoch is fine for design but not as a management technique; 2) heterogeneity is key in a team to facilitate innovation.

robinchase.jpggoloco.gifOn Thursday afternoon we were hosted at Harvard by the School of Engineering and Applied Sciences. They gave us a brief summary of their plans for us over the coming week. Following this we had a seminar with Robin Chase from GoLoCo, Zipcar and Meadow Networks. I’ve been a huge fan of Robin’s concepts ever since I saw a video of her presenting at the infamous TED conference series. We had a fascinating conversation about her startups, her business approaches, her views on congestion charging and green tech, as well as her concepts on mesh networks which I am particularly intrigued by!!

johnakula.jpgOn Friday 29th we spent the day at Harvard’s School of Engineering and Applied Sciences again. In the morning we had a talk with John Akula, a Senior Lecturer of Law at the Sloan School of Management at MIT. John framed an interactive seminar around the general issues of changing jobs, with particular focus on associated legal constraints including: 1) At-will employment; 2) Trade Secrets; 3) Duty of Loyalty; 4) Non-competition agreements. We analysed two case studies with these legal issues in mind.

rickharriman.jpgFriday afternoon was spent studying creativity with Rick Harriman from Synectics. He gave a seminar on an approach to creativity which uses random objects and trains of thought to come at problem areas from completely unique angles. This approach is something I’ve come across a few times previously during training with the Cambridge MIT Institute, and also with NICENT. The phrase I usually use to describe this method is “Reverse Invocation”. Rick highly recommended the TRIZ journal.

Rubbing Shoulders in $ilicon Valley

nickmckeown.jpgWeek5end 23-24 Feb: Over the weekend Stuart and I spent some time with Peter Davies, one of the most seasoned entrepreneurs in Silicon Valley. We got on very well with Peter and as a result we ended up at his house having dinner with his family on Saturday evening. Nick McKeown who was also there gave Stuart and I some great advice on new ventures and startups. Nick is highly regarded within Silicon Valley for spinning many companies from Stanford, where he is a Professor of Electrical Engineering and Computer Science (bio).

davidperry.jpgOn Sunday morning we also met Peter for breakfast in Palo Alto’s University Ave Café. On this occasion Peter brought David Perry along to chat with us. David is first and foremost a friendly and fun guy to chat with. Business-wise he is a titan, as is evident from his first startup – Chemdex.com (http://en.wikipedia.org/wiki/Chemdex). Chemdex still holds the record for reaching a $10B valuation in the shortest time, which was at the end of 1999. Following the realisation that here was no air left in the Internet Bubble, in early 2000 the company fell to a valuation of just over $100M, and from 500 to 100 employees! It was interesting to listen to David describe how he took the company to this amazing valuation and how he coped following the crash in 2000. Read the full Chemdex story here. Not content with this he has started two companies since then and is currently in the process of making an IPO. David has impressively raised over $½Billion in VC funding since the early 90s!!!

David had a few insights into how to be a successful entrepreneur:
1.) The first is to not worry so much about what it is you are doing as long as you fulfill 2 criteria. They are that you are always learning and you are enjoying what you are doing. This mantra is true whether or not you are perusing entrepreneurial activities, or working for a company.

2.) Secondly he outlined a perspective for pitching and raising capital. The idea is to basically spell out the opportunities of the project first. No opportunity comes without risk, and if you pretend it does, any VC will laugh you out of the room. Then you focus on describing how you are going to eliminate these risks, one by one. Present risks based on their severity and potential to prevent progress. This approach tells the investor that you’re not naïve about the presence of risk, and that you’re aware that they’re investing in your ability to mitigate these risks, one by one.

The ingenious part is once you have outlined the fantastic opportunity, prep’ed them with the risks, then instead of asking for money to pursue the opportunity, you ask for the money to eliminate the risks. So if you identify the risks in order of priority and necessity, and ask for X amount to overcome the top Y risks, you can show how strong the company will be at that stage. Inherent with this approach is transparency of preempted risks & your control of them, as well as knowledge of how much investment will be required at stages to continue to eliminate further risks. If done properly, you will organise the risks into stages (e.g. milestones within an Implementation Plan as outlined in Zoller’s last seminar), and at each stage it will become easier to raise the capital required to overcome associated risks.

Finally David also warned about a situation that currently seems a long way off, and that is raising too much money! Apparently he has encountered the situation, and Peter also, where VC’s wish to invest a much larger amount of capital than is required. This usually occurs when investor groups work together and all want a piece of the pie. In this situation, to support the higher valuation this causes, it is too easy to spread the company too thinly and work on products that aren’t core to your business, and therefore you can lose focus on the key areas. Not something that is immediately relevant perhaps, but something to think about nonetheless.

Next Stop…..Governator Central

copy-of-img_4803.jpgWeek 5: 18-22 Feb: We moved onto San Jose, California, on Sunday 17th after a 6hr delay at Kansas City airport which was closed due to severe snow storms. During the delay some of us slept and some worked!! It was warmer in CA to say the least, about 20C! Monday was spent in San Fran touring about seeing most of the sites around Fisherman’s Wharf. Owen and I also cycled across the Golden Gate bridge to what I think is one of the best viewing points in the city.

On Tuesday 19th we went to ‘Wilson, Sonsini, Goodrich & Rosati’, the premier legal advisor to technology and growth enterprises worldwide, as well as the investment banks and venture capital firms that finance them. Two representatives from WSGR discussed IP issues in technology ventures.

2ndlife.pngIn the afternoon we visited Linden Labs, which was founded in 1999 by Philip Rosedale to create a revolutionary new form of shared experience known as Second Life. Second Life is a 3D virtual world entirely created by its Residents that’s bursting with entertainment, experiences, and opportunity. The Second Life Grid provides the platform where Second Life resides and offers the tools for business, educators, nonprofits, and entrepreneurs to develop a virtual presence. Headquartered in San Francisco, Linden Lab has over 200 employees spread across the U.S., Europe, and Asia. Although our visit to Linden Labs was brief we had a change to get some insight into where Linden Labs is going with Second Life in the future. They were more than willing to answer all our questions. Second Life generated some interesting debate among the group. Some of the group had difficulty seeing its practical usefulness, whereas the rest of us saw endless opportunities for the platform in the future.

sbiodesign.jpgWednesday 20th saw us at Biodesign, a Stanford University initiative encouraging multidisciplinary approaches to biology and medicine. Biodesign are refining a method that produces both world-class innovators and state-of-the-art medical devices. We were introduced to the biodesign leadership (incl Sandy Miller) and fellows from both the US and India. We had a chance to tour the Stanford campus during lunch before continuing with a seminar by a biodesign spinout company – Simpirica Spine. The CEO gave us some practical insight in the startup process based on his own experiences. He shared his experience of equity dilution through various rounds of investment as well as many other

msstartupzone.jpgOn Thursday we visited Microsoft’s campus in Silicon Valley where we met Dan’l Lewin, corporate vice president of Strategic and Emerging Business Development, Don Dodge from Microsoft’s Emerging Business Team (& ex-Napster VP), Roy Levin Distinguished Engineer and Director, Microsoft Research Silicon Valley, as well as the general manager of the Microsoft Startup Zone. I had the privilege to chat with Roy after the formal presentations about pervasive computing and how he envisions its realisation in the future. I have my own specific thoughts on the matter but it was insightful to have a conversation with such a seasoned computing researcher and visionary.

Following the slightly rushed MS visit we went to the British consulate in San Fran. They offered us the opportunity to utilise their extensive network in Silicon Valley. Also they detailed some grant support which is available for us to attend conferences and companies in the US. In the afternoon we visited iRhythm, a biodesign startup in the medical devices area. The CMO at iRhythm, Uday, detailed some of trials and tribulations of starting a business. Uday’s talk was very impressive, he provided practical and insightful advice for us going forward and starting our businesses.

otl.gifOn Friday we attended Stanford’s Office of Technology Licensing. Linda Chao brought us through Stanford’s approach to technology licensing and related equity issues. This proved a very interesting talk as probed Linda for information on how University spin-offs are handled by one of the world’s leading research and teaching institutions. Basically Stanford claims IP on everything developed through the use of their resources. Not only do they pay for IP protection, such as patenting, but they are also willing to enforce IP – this being the main reason why anyone would want to license IP they generated from an institution such as Stanford.

johnhennessy.jpgOn Friday afternoon, after a long tour of Stanford’s campus we all attended the launch of Stanford’s Entrepreneurship Week and their annual Innovation Tournament – which this year requires entrants to add as much value as possible to a rubber band(s) within 1 week. Prof. John Hennessy, President of Stanford, gave the introductory speech for the launch in which he talked about Karl Schramm, the Kauffman Foundation and its global role in entrepreneurship education.

Global Scholar Presentations

Week 4: 11-15th Feb: The rest of week 4 was spent preparing presentations for pitches that took place on Wednesday in front of the Global Scholars and our mentors from the Kauffman Foundation. This gave us an ideal opportunity to implement everything learned during the first 3 weeks. It was obvious through our new and improved presentation styles, business lexicons and project developments that we had all progressed alot.

john_tyler.jpgAs usual Stuart and I made use of free time following the presentations to meet some people from the Kauffman Foundation. On Friday morning we met with John Tyler to discuss IP, Trademarks, Patenting, company formation in the US and other related areas. John is great at providing insight into complex areas and problems surrounding IP. He quickly resolved various issues Stuart and I had regarding IP and Trademarking in particular. Also, on Friday we had meeting with the Kauffman Foundation team organising a mobile infotainment project around the Olympics to improve maths, engineering and science education globally.

Building Teams & Social Networks – Howard Aldrich

copy-of-img_4650.jpgDay 16, Monday 11th Feb: Week 4 was preceded by some quality R&R in Ponca City, Oklahoma, over the weekend. Owen and I visited my girlfriendsfamily down there for a couple of days. Without detailing too much and shaming the Kauffman Global Scholars program for all of eternity we went to a shooting-range, were in awe at some buffalo up close, laughed at stupid prairie-dogs, felt intimidated by real cowboys at a calf roping competition, had quality BBQ, and last but certainly not least swallowed a beer or three!

aldrich.jpgWeek 4 kicked off with our last seminar at the Kauffman Foundation by Prof Howard E. Aldrich titled “Building Teams and Social Networks”. Howard is professor and department chair of sociology, and adjunct professor of management in the Kenan-Flagler Business School at the University of North Carolina. Prof Aldrich researches entrepreneurship, the origins of new organizational populations, gender differences in business management, organizational evolution, and the process by which entrepreneurial teams are founded. He alluded to many of these areas during his seminar with us, but focused primarily on the use of LinkedIn.com in forming strong professional networks. Howard emphasised a few points including:
– Why aren’t individuals more connected?
– Overlapping ties, social barriers, uncertainty, trust
– Need a broker to make connection between you and target contacts
– Direct vs. indirect & strong vs. weak contacts
– Strong ties -> homogeneity -> easier comms -> consensus -> ignoring incumbent truths
– Weak ties ->heterogeneity -> diversity
– Contact list = weak ties -> couldn’t vouch for if asked
– LinkedIn (in Howard’s opinion) = strong ties -> could vouch for them
– He worked through one scenario with us of who we’d make one critical phone call to in an emergency-type situation where we could be sure that person would help

New Venture Bootcamp (Parts 3&4) – Ted Zoller

ted-zoller.jpgDay 15, Friday 7th Feb: Ted Zoller continued his intensive mini-MBA program with us from yesterday (Part 2). Bare with the excessively long blog on this occasion as I felt it was necessary to do justice to the amount of material covered. Today’s seminar focused on the most important factor in the validation of a business plan – the Implementation Planning. An Implementation Plan is a representation of the coordination of time & resources (human and physical). New ventures are by definition under-resourced, so one is usually executing ventures that have missing pieces. You can compensate missing pieces by over-compensating from available resources, by asking others to play a role, and by leveraging outside resources (e.g. contractors, services)

Primary constraints when starting up a business are Time & Money (money = time). Usually you can’t buy yourself out of a time problem but you can retime a money problem. Use measurable milestones & building blocks to resource these. Implementation Plan (ImP) explicit way to:
– Characterise these key milestones
– Coordinate marketing, financial and operational functions in business
– Maintain awareness of resources – personnel, fixed & variable assets
Need to consider key timing questions; do my milestones = customer milestones?
Best to set my milestones, & then set additional conservative milestones behind them –> expectations always met & provides breathing room.

Ted made the point that you should always try to avoid selling time. Although if it is necessary, don’t put yourself at a disadvantage. Its common for you to try and set value of time, but how do you define value? What is a unit of time worth? You don’t know what the value the client sees in the work. Determine their sense of value and keep below their price point. Challenge them to set this price point, NOT yourself. Another point which was raised was that: Value of work is very rarely linked to cost.

There 3 basic techniques in contracting with varying risks for the entrepreneur:
1- Time/materials/spec based billing; paid per unit utilised – low risk
2- Cost Plus = direct costs + margin (e.g. 25% fixed profit) – low risk
3- Fixed price contract – high risk
All 3 focus on optimising cost on behalf of the client. Juxtaposed to this, it’s better to use value-based billing which removes price from the equation. This means evaluating how the client values work not how they manage their money/budget. It may be worth everything to them to get the project done.

An Implementation Plan has 3 functions:
– Management tool – if you can’t model it you can’t manage it!
– Communication – at all levels to internal team, customers, clients, investors
– Staging tool to 1.) define dependencies between activities; 2.) understand key milestones & communicate them; 3.) allocate resources appropriate to them.

The Implementation Plan is tied directly to the financials, what you’re doing & ultimately how it’s funded. You must plan financial phases around the milestones in the plan. Ted advised that key milestones should revolve around when you’ll be OOC – out of cash! He also recommended measuring OOC from 6 months out or more, not the usual 3. Some other misc points:
– Cash, not asset, management keeps you in business
– Investors use milestones to negotiate – separate milestone-based tranches
– Milestones = negotiable; $$$ invested based on milestones being met
– Pin investors (& board) down on clear semantics of milestones

Some lessons from a Harvard paper titled “Milestones for Successful Venture Planning” by Block & Macmillan:
– Milestones are customised to the needs of the company
– 2 Levels: 1) Product/short term 2) long term
– Significant events, not just dates/chronology
– Time is a driver, but money is the key driver of milestones/events
– Ultimately managers are using milestones to communicate internally, if not, then not useful
– Contingency plan should be included in ImP
– ID who’s delivering on each milestone and hence relevant functions/people
– Success more to do with how using time & who engaging with than just chronology
– ImP includes: phases, tasks, sub tasks, dependencies. Track actuals (incl slippage) against plans
– Usually throwing people @ problems ≠ solutions
– Critical path analysis: end of each phase – elapsed time between start & end
– Set milestones at start of phases – opening of new advent!
– ID milestone that indicates a break through/success? E.g. first client/delivery/prototype/launch

Ted moved on to discuss some management issues:
– Better “A” team and “B” idea than the opposite, as you can always improve the idea
– Beg/borrow/steal you’re “A” team!
– Generally shouldn’t pick team members based on personal relationships
– Choose founders based on what they bringing to the venture
– Ensure they get the concept and are instrumentally engaged in venture
– If they tick these boxes and are a friend, you need to be careful and have a lot of pre-venture discussion around how to deal with crises
– Investors/partners bet on teams primarily
– Board of Directors – governance of company
– Board of Advisors – provide market insight – strategic advice
– ID that you’re somewhat aware of what you don’t know
– When starting only include core/essential people/functions – outsource others

M. Thatcher: “Look at a day when you are supremely satisfied at the end. It’s not a day when you lounge around doing nothing; it’s when you’ve had everything to do, and you’ve done it
Key lessons from the morning seminar:
– As company evolves it takes on various different organisation forms
– Focus on functions and align functions to potential co-founder that demo competency in relevant areas

Financials – In the afternoon Ted gave us a general overview of how to approach financial management of a new venture, including discussions on:
– Unit economics – the items that DRIVE the revenue and expenses of a business
– Model building – steps to building financials – staffing, marketing, other expenses
– Using the financials – from unit economics to financial statements – P&L, CF, BS
– Evaluating profitability – scenario analysis to move past BEP
– Funding the venture – Friends/family & /bootstrap, grants/awards, public/private seed, angels, speciality, VCs, debt, strategic investors
– Synchronise financials to implementation plan
– Capital acquisition strategy, think – who/when/what for (%)/terms/compromises/due diligence
– Following successful VC pitch ≥ 5 months before $ in bank
– Exit strategy: lifestyle/IPO/M&A/defined redemption/management buyout/asset liquidation
– Valuation – usually a discounted present value of future cash flow. A multiple of earnings at a point in future reduced by a discount factor
– W. Churchill: “Success is the ability to go from one failure to another with no loss of enthusiasm

In general Ted parted with an intimidating amount of knowledge during his 4 seminars with us. He basically covered every aspect of venture startup that one needs an awareness of. It’s amazing how well he comprehensibly and practically articulates and verbalises knowledge in short conversations that would normally fill several book chapters!! Ted connected the dots between everything we had learned thus far during our time at the Kauffman Foundation – he filled in every remaining gap and made the bigger picture easier to “visualise”.