Category: Startups

Tips for Applying to TechStars

Nicole Glaros3 Comments

Given that TechStars in Seattle application deadline is looming (June 1 – get ’em in!), I’m reminded of the challenge of reviewing so many great applications in such a short period of time.  I thought I might throw out some tips to applicants from my perspective (in having to review nearly 700 applications for 10 spots in Boulder).  Hopefully this will make Andy Sack’s life easier!

  • Apply early!  This year, we got almost 25% of all applications in the last 6 hours.  We had mere days to review those final applications before narrowing it down to the finalists.  I spent a sum total of maybe 2 minutes per application at that point, and thus probably missed some gems.  The earlier you apply, the more time we have to review your app.  You can always edit your application once it’s submitted (plus, applying early lets you update us on your progress, showing execution and communication).
  • Team.  Execution.  Idea.  In that order (usually).  Make it ridiculously easy for us to see how killer your team is, that you’ve done cool stuff or know how to do cool stuff, and that your idea is unique.  Don’t bury it in tons of words; communicate it quickly, not in a diatribe.
  • I feel the need to repeat the above point.  Team.  Execution.  Idea.  In that order.
  • Execution is everything – once your application is submitted, don’t be afraid to send ULTRA short 1 line emails to me updating your progress.
  • Registering a URL doesn’t count as progress.  Mockups don’t count as progress.  A functioning prototype counts, as do added features.  So do page views & customers.
  • Show me, don’t tell me.  I loved 1-3 minute videos because I got to see the team and a quick demo of the product.  Anything longer than that I barely watched simply b/c I didn’t have the time (or I stopped watching at minute 3).
  • If you password protect your video, please make sure the password is included with the application.
  • If your site requires a beta invite, send me one!
  • Make sure the email address you submitted works.  Surprisingly obvious, but I’m listing it because a handful didn’t.
  • Single founders have a hard time at TechStars because of the speed at which the program moves and what is demanded of you during that time.  Work really hard at getting a co-founder if you’re by  yourself.
  • I responded to every single email I received.  But sometimes it took me a few days.  Be patient, and don’t take ultra short emails personally – it’s purely a volume challenge.
  • Have a technical founder.  We move at the speed of light here.  Outsourced firms can rarely keep up with the pace that’s demanded.
  • Small picky tip – when emailing, put your company name in the subject line.  Helped me to keep organize and remember who went with which company.

Good luck to all teams that are applying, and if you are non-selected, don’t take it personally.  Use it as a challenge to keep working hard to get to a point where it does make sense.  I felt truly honored by ALL teams with the privilege of being able to glimpse into what they were doing.

    Someone save me from Intuit, PLEASE

    Nicole Glaros4 Comments

    I hate Intuit.  I think they’re products and business philosophy sucks so badly that I’m in support of ANY startup wiling to take them on.  And yes, hate is a strong word, but here’s why:

    • On April 30th, my version of Quicken (2007) stops working.  I’m FORCED to upgrade.  REALLY?  FORCED?  Who does this?
    • I use Quickbooks 2007 too.  As of May, it will no longer work.  I’m FORCED to upgrade.
    • I have a client that upgraded to Quickbooks 2008 a while ago.  Then she tried to send me the QB file.  Turns out QB2007 couldn’t open QB2008 files.  WTF?  I don’t even begin to understand the philosophy behind this.  It’s gouging.
    • Both programs make life much more difficult than they need to be.  Workflow in QB sucks.  Workflow in Quicken is decent, but the reports suck.
    • I’m on a Mac, I run Windows in a virtual environment for the sole purpose of running Intuit products.
    • TurboTax isn’t available for the Mac.
    • Quicken for the Mac isn’t available to try.  You have to buy it and return it if you aren’t happy.

    Their general philosophy is to trap you into their products then force you to continue using them, instead of just keeping their users happy by creating good products that work are better than the competition.

    So given my Quicken expires tomorrow, I’ve been frantically looking for a Mac compatible product to replace Intuit.  The thought of paying them for anything else literally makes me sick.  Sad to say I’ve not found a decent replacement, and I’m probably going to continue using the upgraded versions of the products in the windows environment on my Mac.  But I figured I can’t be the only one going through this nightmare that I’ve pumped too many hours into now.  So for the sake of anyone else looking for a replacement, or for entrepreneurs looking to unseat Inuit, here’s my ultra-short descriptions of what I need and what the competition lacks.  Calling all entrepreneurs – if you a) improve your product to match my needs or b) create a product to match my needs, I’ll be your first customer.

    Mandatory Product Requirements (from my perspective)

    • Classes or Tags – I track my spending and my husband’s spending.  I want to know how much he spent on bike crap compared to me.
    • Download all transactions at once – some products make you go to the bank’s website to download the transactions.  There should be one button within the program that lets me download all institution’s data at once.
    • Customize Reports – I have a couple of ultra small businesses that I don’t want to run Quickbooks for (rental property, consulting).  I need to use tags/classes to adequately categorize those transactions (see first requirement), but also to run a report to give to my CPA during tax time.
    • Export reports to Excel or .csv or whatever.
    • Budget – I want to budget items and know when I’ve gone over my budget
    • Split transactions

    Nice to haves:

    • Easily enter transactions by just tabbing through fields and not having to use my mouse.
    • Subcategories
    • Sync with iPhone
    • Wouldn’t THIS be cool – take a picture of the receipt with my iPhone, and it would automatically enter that transaction in my register and ask me for a category right then/there.  I love this concept so much – b/c now I have a record of my receipt, I can throw it out and reprint it later if I need it.  Reconciling will automatically compare my entered transactions to my downloaded transactions – so I know what I’ve missed.  Also have the ability for two people to snap a photo of the receipts and sync both of those people’s transactions with the software.
    • I also think it would be cool to have a widget that could display the budget/spending/income overview on both my computer and my husband’s computer.
    • I could go on, I have more ideas here.

    Competition overview (very very brief!):

    • iCash – seems full featured, but I can’t download transactions.  Have to go to each bank account, download, then import.  boo. Ugly, workflow is difficult.
    • iFinance 3 – I can’t download transactions.  Really?
    • Cha-Ching:  Can’t download all transactions from all bank accounts at once, have to navigate to each bank’s website first.  Also, difficult to download multiple accounts from one bank.
    • Squirrel – can’t download, only import.
    • MoneyDance – ehhhh.  Ugly, I couldn’t figure out how to make the download understand there were 4 accounts at one bank.
    • MoneyWell – No tags, no subcategories, no export to xcel.  But other than that, very nice workflow.
    • Jumsoft Money 3 – couldn’t get to their website to download and try
    • Fortora Fresh Finance – Can’t do tags.  Ugly. But can download, export to xcel, and has nested categories.
    • iBank – no classes/tags

    I probably haven’t seen all available software.  I’m open to suggestions.

    Second best answer to yes is no

    Nicole Glaros1 Comment

    I’ve seen this theme come up recently a lot in talks with entrepreneurs trying to raise money, or trying to sell their product. A ton of time is spent working with the investor or possible client, and the discussion ends up going nowhere. Cycles are lost, people are rejected without knowing why, and everyone gets frustrated.

    I’m a big believer in honesty about what I’m thinking and feeling, and that includes saying no. In any discussion, the second best answer to yes is NO. Silence is the worst thing you could ever do to someone. I’m not sure why people feel the need to go silent when they really want to say no. Is it that we as a culture like to avoid conflict? We don’t like to let people down or disappoint? What is it about that two letter word that is so scary?

    I say that as investors, parents, friends, colleagues, bosses, whatever your role, we all practice saying no – but give reasons why. It’s no fun to be rejected, but at least when armed with the reasons why, we can improve our pitch, product, stance, opinion, whatever the question. In this scenario we all win. The askee isn’t continually bugged with a proposition, the asker can improve the ask and simultaneously move on quickly to other prospects. It saves time, frustration, and feelings.

    Don’t be afraid of saying no. But do so with support and information, and we all win.

    Spilling the beans

    Nicole GlarosLeave a comment

    I’ve just experienced 2 extremes of company culture – ridiculously open and communicative vs. insanely tight lipped and need-to-know.

    The first company, ridiculously open and communicative, was very fun to work with.  Everyone trusted eachother, everyone knew eachother’s salary, we knew how long the runway was before we couldn’t make payroll, we knew if we landed or lost a big client, we knew when the CEO screwed up, we knew everything.  Everyone knew everything.  It was exhausting, but very fun because there wasn’t anything you could hide so everyone helped eachother.

    The second company’s founders came from the fortune 100 world.  Everything was need-to-know.  There was a general sense of distrust there, and there was LOTS of talking behind backs and closed doors.  This company went through an acquisition that was almost derailed simply because the staff didn’t trust what they were being told, and very nearly walked away which would have completely sunk the deal and the company.  Even though no-one was ever lied to, no-one was ever sure they were being told the truth, or the whole truth.

    I bring this up because I just read Fred Wilson’s “Do Loose Lips Sink Ships” – who alludes to a similar conclusion.  While it’s empirical, the evidence suggests that the more open entrepreneurs have an increased likelihood of success.  And while Fred came at it from the angle of entrepreneur-investor communication, I think the same is true of a company’s culture.

    Be radically open.  Bring your whole team into the loop and don’t hid anything, especially your weaknesses.  You might lose a person or two with this method, however that eliminates those without the stomach for a startup, thereby strengthening your whole team.  And you’ll have everyone’s buy in, or at very least hear some ideas and opinions you haven’t yet considered.  It’s more fun anyway.

    Never cross a stream with an average depth of 4 ft…

    Nicole Glaros2 Comments

    I was sitting at the table with investors interested in putting some capital into one of the companies with which I’m working.  The questions were around assumptions – are the assumptions you’re making in the business sound?  What happens if they’re wrong?

    And the answer by the entrepreneur (okay, Lu Cordova), was fabulous.  “Never cross a stream with an average depth of 4 ft, it’s the variance that will kill you.”

    What she meant by this is understand your variances, understand the best and worse case scenarios of all critical factors to your company.  I know you believe you’ll do $75 M in revenue in year 2, but what happens if you don’t?  What happens if you don’t close this round of funding?  What happens if the CEO you hired turns out to be a schmuck?  Run your model with the most plausible scenario, then the best case, then the worst case – and see what happens.  If you can stay afloat in a worse case scenario, you do well both in business and with fundraising.

    Know your variances – it will keep you from drowning.  Great lesson by Lu.

    You’re most important investor is your….

    Nicole Glaros1 Comment

    …spouse.

    Investors invest cash and (hopefully) time into your company.  Their decision to invest in your venture is usually a business decision (unless you’re friends, family, and fools cash).  However, your spouse invests cash (probably your savings), your house (2nd mortgage), your children’s future education, his/her time with you, his/her sanity, and possibly the marriage…  your spouse basically puts EVERYTHING on the line, not just cash.

    Yet the tendency is to come home and unload on your spouse.  “We can’t make payroll this week”, “We lost the biggest deal, I’m not sure we’re going to make it now”, “That stupid employee….” the list goes on and on.  What that does essentially paint a very poor picture for your biggest investor, which will in turn cause significant doubt on his/her part that you can succeed, which will also create friction and resistance to your business at home, the very place you need the most support.

    The  best thing you can do for your business and your marriage is to treat your spouse like your most important investor (which they are!).  Don’t unload on him or her, but rather be optimistic on what’s going on.  “We lost our biggest customer today but I’ve got 2 other deals in the works that could make it okay…”  When you have the full support of your spouse, you’ll find they come in to the office to help with grunt work, they’ll edit/read documents for you, they’ll do whatever it takes to ensure your success.  It can save your business and ultimately your marriage.

    But now you still need someone on which to unload.  Here’s where your advisory board (different than your board of directors) comes in handy.  You should have established this on day one.  Create yourself a personal advisory board that will help you think through founder problems.  Most people are very willing to help be a sounding board, and if you select carefully, your business will be stronger with it.

    The next billion dollar idea – Placebutt (pronounced Pla-see-butt)

    Nicole Glaros1 Comment

    It’s a diet pill.  It’s a placebo.

    Here’s the marketing angle.

    Your diet pill doesn’t work anyway, it has those nasty side effects and is expensive!  Start taking Placebutt today – research shows that if you believe something will work – it DOES work!  So pop a Placebutt every morning while BELIEVING that the pizza you ate or dinner last night didn’t just stick to your thighs.  BELIEVE Placebutt will help you to lose weight, and it will!  Without those nasty side effects or a dent in your budget, Placebutt is the placebo for everyone.  And IT WORKS – but you have to believe…

    We’ll make billions.  Now I need a partner.  Who’s with me?

    Fred Wilson’s “A Lead Investor”

    Nicole Glaros1 Comment

    Thank you to Fred Wilson who posted an insightful blog on the definition of a “lead investor”.  If you are looking for capital, this is a must read.

    Working with the startup world, I can tell you that 90% of angel investors are bandwagon junkies.  Most of them will only invest when someone else already has.  So if you’re looking for capital, focus all of your efforts on a champion.  Someone that will sing your song as loud as you.  Once that champion investor is found, you will get your capital.   But this person is 1 in 10 (or 50 maybe, or even more).

    This isn’t a bad thing by the way.  Most investors have an area of expertise.  If they only invested in their area of expertise, think how limited they would be in where they could invest.  Good investors will be leads in areas they know, love, and understand, and can be a great resource for other investors with little to no knowledge of the area.

    So, if you’re looking for capital, find investors with a deep knowledge of your area, and you’re most of the way to finding your champion/lead investor, and the capital you need for your company.

    And, as always, if you’re looking for capital, ask for advice.  If you’re looking for advice, ask for money.

    Attention Entrepreneurs – 100% of a taco stand or 5% of the next billion dollar company?

    Nicole GlarosLeave a comment

    I had drinks last night with a good friend and we got to discussing the pain most entrepreneurs feel in giving up equity in their company. In fact, back in my days at CTEK I clearly remember an instance with a bioscience entrepreneur. He had a patent on a fabulous technology. World changing technology. Next billion dollar company technology. Everyone around this company was chomping at the bit to invest, except for one major problem; the entrepreneur was a bit of a loose canon. I remember sitting around the table with about 15 angels who were ready to invest close to $3M in capital, a very large sum for independent investors in Colorado. There was the usual negotiation on valuation, whereby the higher valuation (favored by the entrepreneur) meant he would keep more of his company, while the investors wanted a lower valuation (they would own more).

    In a moment of frustration, and clearly the moment his fate was sealed, the entrepreneur said “I’m not bending on this point because I am GOD. This is my company, my technology, my product. Do it my way or get out.”

    Know what happened to this particular entrepreneur? Nothing. He needed funding to get him to the next stage, couldn’t get it, and his company died. Now, I’m not saying you should always listen to investors. They have their own best interest at heart usually, which is protecting their investment. Nor am I suggesting this entrepreneur is the norm. But getting investment capital always comes with a high price tag. If you don’t like it, get a loan, or bootstrap (a FABULOUS option). But investment capital can frequently accelerate success for many companies. So you can either own 100% of a taco stand, or 5% of a huge company.

    Automate early-stage fundings – a challenge

    Nicole Glaros1 Comment

    One of the organizations I work with just finished a Series A financing.  This is the first time I’ve been on the receiving end of the money – my past lives have all had views from the investing end of the cash.

    The one thing that has struck me during this process is how intensive the process really is.  I am downright shocked and dismayed at the amount of resources a company uses in order to raise capital.  The CEO’s cycles are on fundraising almost full time, in addition to myself, and the COO.  This isn’t to mention the dollars spent on attorneys fees, and the cycles from our board members and advisors.  I bet if we sat down and tracked the number of hours spent (excluding the opportunity loss from not focusing on things like sales) and added in all attorneys fees, it would be so disgustingly not worth the raise.  In fact, I think if investors had any idea how much of a company’s resources went into fundraising as opposed to growing sales, launching product, gaining market, etc, they might not even invest under a certain dollar amount.  I wonder what the magic investment number is to make this process worth it.

    One thing that strikes me is that software could be used to somewhat automate this process, thereby DRASTICALLY reducing the adminstrative burden of a capital raise.  Letters to investors, responses to letters, signatures, deposits, stock certificates, phone calls, faxes, etc all could benefit from automation.  What a great product that would be.