Cake
  • Log In
  • Sign Up
    • Chris

      Next Tuesday morning at 11 California time, I'll start a panel with a couple of venture capitalists here in Silicon Valley. They invest in very young companies like Master Class, the online learning company with courses taught by very big names, and Frame.io, the online video editing company for pros.

      I'm compiling a list of interesting questions and I'd love to hear yours. These guys get to hear the most fascinating pitches from entrepreneurs about startup ideas. How do they decide to put $300 million into an electric scooter rental company? What about blockchain and crypto currencies?

      What makes them back a company whose idea is to provide an air mattress for strangers to sleep on in their homes, and who sold cereal at the Democratic convention to keep Air Bed and Breakfast alive?

    • Vilen

      I'm always wondering and wished I could simply ask a venture capitalist:

      "What is the most important thing that you look for when evaluating potential investment in a startup?"

      In one of my favorite videos from Ted about startups The single biggest reason why startups succeed by Bill Gross, he says that timing is the most important aspect to predict startup's success.

      Here are the 4 aspects (5th being Funding) from his talk:

      1. Timing

      2. Team

      3. Idea

      4. Business Model

    • yaypie

      What are some common mistakes people make when pitching to VCs that you wish they'd stop making?

      How often do you hear a pitch that you find compelling personally, but that you know would be a bad investment? What about the reverse: ideas you find personally repulsive but know would be a great investment? What do you do in these scenarios?

      How do you balance ethics versus economics? If a pitch is ethically sketchy but could make you a billion dollars, does your responsibility to society mean you should say no, or does your responsibility to your fund's bottom line mean you should say yes?

      Is there an idea or a general area of interest you're dying to hear a good pitch for, but that nobody seems to have nailed yet?

    • Shay

      what is their ratio of success v failure?

      Do they take stock in the companies and actively participate in the day to day running of the company / or do they sit back and let the company they have invested in grow by itself.

      Is there a timetable for a return on their money?

      For context; I know SmugMug never took venture capital and this allowe Smuggy to stay independent?

    • Chris

      For context; I know SmugMug never took venture capital and this allowe Smuggy to stay independent?

      That's true. It's a hard tradeoff because you have to starve for years and then you're vulnerable to better-funded competitors. It worked out with SmugMug because I could fund it a little, it was in my house for 4 years, I took no salary for 5 years, and my family was willing to work for peanuts.

    • DanSolarMan

      I wish I had seen this sooner. I read the discussion and it was fascinating.

      I would have asked.

      Does a small inventor working on a revolutionary way to ventilate attics and sheds with solar in a small shop in Fountain Hills Arizona. That has just landed a national account with a major US corporation, stand a chance to scale fast enough to change the world?

      With all the experience 58 years of life on this planet offers.

      Crazy talk!

    • Chris

      You know, Dan, I've raised venture capital three times now, for three different companies. I think it's a shame that if you commit to VC, you are committing to strapping yourself to the side of a rocket and hanging on for dear life. You must grow fast or they will find someone who will grow it fast.

      It's not that I don't like venture capital, I do, without it we wouldn't have Google, Amazon, Apple, Netflix, Starbucks, and many others. It's just that it seems there ought to be a better investment vehicle for small businesses that do good things but have more humble ambitions.

    • DanSolarMan

      My wife just walked in and says, “do you know what the value of our company is now that we earned this new account?” I told her yes certainly it has increased. (Now we can pay the rent) lol.

      People ask me all the time why I don’t go to Shark Tank?” Because they want a portion of my non-existent profits. I have always been fascinated with little guys in small shops tinkering away on the next big thing. I can tell you flat out if I knew what I know now how hard it would be to do what I’ve done I would not have done it. In the moment one day at a time and one small accomplishment per day.

      I hired a our first person outside of friends helping recently. I might have talked about him here before. He amazes me. I’ve known him since he was six. I used to drive an hour each way just to watch him wrestle and this year he won the state championship at 145 in WA State 4A. He is going to ASU for business and he told me something kinda cool the other day. He said that my business is me. That the people that do business with me believe in me and my products. I had a new dealer tell me last week he wants to do business because he wants to be part of the movement.

      Tons of people invent things. Tons of people sell things. Tons of people administrate things. Tons of people market things. The really tough part is doing all this at a high level and having the skills to do them all well. I would speculate that a venture capitalist that invested a portion of their energy into small guys like me with big plans and dreams might hit on the next big thing. Yet I can totally see the risk in investing in sole proprietors.

      After all, as I learned in Amway. Everyone needs laundry soap. Inventing and selling a product that everyone in America needs has its upside.

      Here’s a pick of Chad after building his first vent.

    You've been invited!